AFG’s sale of its 30% stake in AIA AFG Takaful does not come as a surprise given AIA’s acquisition of ING’s Malaysian operations. In our view, valuations appear fair while a one-off gain on disposal will provide a modest lift to earnings. We gather that a search is underway for a new partner, but nothing is on the table at the moment. Neutral call and fair value of RM4.35 maintained.
Selling off 30% stake in AIA AFG Takaful ... AFG announced yesterday a conditional share sale agreement with AIA for the disposal of its 30% stake in AIA AFG Takaful for RM45m, cash. Recall that AIA AFG Takaful commenced its family takaful business not too long ago, i.e. 28 Jan 2011. Apart from the above, AFG had also entered into an eight-year bancassurance tie-up with AIA in FY03/12 to offer conventional life insurance products.
Source: RHB
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