Kuala Lumpur: At least four foreign insurers, including two from the US, are among several parties believed to be close to making a bid for Kurnia Insurans (Malaysia) Bhd, according to industry sources.
US-based Liberty International Holdings Inc and Chartis Malaysia Insurance Bhd, whose parent AIG Inc was rescued by the US government in 2008, are believed to be vying for the stake owned by investment holding company, Kurnia Asia Bhd.
Another potential suitor for the stake in the largest general insurer in the country is Insurance Australia Group Ltd (IAG), which holds a 49 per cent stake in AmBank Group's general insurance arm, AmG Insurance.
AmG Insurance is on the lookout for a sizeable insurer having failed to buy MAA Holdings Bhd's general insurance business arm after protracted negotiations.
IAG sees a lot of potential in Malaysia and has intention to up its stake to 70 per cent from 49 per cent currently in AmG Insurance, the third largest motor insurer in the country.
Another party that had tried but failed to buy an insurance company here was Liberty International.
In June, it attempted to buy a 52.21 per cent stake in Malayan United Industries Bhd's insurance arm, MUI Continental Insurance Bhd.
The Boston-based insurer is part of Liberty Mutual Holding Company Inc, a diversified global insurer and third largest property and casualty insurer in the US.
Liberty Mutual is on an acqui-sition trail in the Asean region and has put Malaysia, a country where it has no operations at the moment, high on its radar.
Chief executive officer of Liberty International Holdings Inc, Luis Bonell Goytisolo, said recently that the insurer would like to expand into Malaysia, Indonesia and Thailand within two years.
Malaysia has been seen as more attractive now since the government announced liberalisation measures in 2009 by raising the foreign equity limit to 70 per cent from 49 per cent. The move is aimed at wooing more established international players to set up operations here.
Meanwhile, for Chartis, capturing a stake in Kurnia would quicken its target to double its business here in the next four years.
It would also propel the group to be the largest motor insurer in the country. Currently, it is widely known in the property and casualty business.
According to Bank Negara Malaysia's 2010 Annual Report, Chartis Malaysia's gross motor insurance direct premium was RM158.8 million while Kurnia's stood at RM384.1 million.
Another name bandied about is German insurer Allianz Group, which has a large motor portfolio and is the second largest general insurer in Malaysia when it completed the acquisition of Commerce Assurance Bhd in 2007.
It is not known if Allianz would be interested to buy another large motor insurance portfolio after it paid RM990 million to purchase Commerce Life Assurance.(Business Times)
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