Maybank takes full control of Etiqa in $1.2b deal

The bank already controls 69.05% of the Etiqa holding company.

Malayan Banking Berhad (Maybank) has entered into an implementation agreement with Ageas Insurance International NV to acquire the remaining 30.95% stake in Maybank Ageas Holdings Berhad (MAHB).

Maybank currently holds a 69.05% controlling interest in the entity.

MAHB serves as the holding company for Etiqa's conventional life and general insurance, as well as family and general takaful operations, across Malaysia and Singapore.

Etiqa is currently ranked as the fourth largest takaful provider globally.

The agreed purchase price stands at $1.2b (RM4.83b). This figure accounts for a $192m (RM800m) dividend proposed to be paid by MAHB on the completion date, from which Ageas will receive $59.5m (RM248m) and Maybank will receive $132.5m (RM552m).

The transaction valuation reflects a price-to-book multiple of 1.98x and a price-to-earnings multiple of 15.3x. Maybank will finance the buyout using a combination of internal and external funds.

According to Maybank President and Group CEO Dato’ Sri Khairussaleh Ramli, the transaction forms part of the group's ROAR30 strategy aimed at expanding its regional insurance and takaful footprint across Southeast Asia.

The acquisition is expected to provide immediate gains to Maybank's profit after tax and minority interests (PATAMI), earnings per share (EPS), and return on equity (ROE).

Maybank has submitted a formal application for regulatory approval to Bank Negara Malaysia, alongside the executed implementation agreement and the agreed form of the share purchase agreement.

Maybank Investment Bank and Morgan Stanley Asia (Singapore) Pte. are acting as financial advisor and international financial advisor to Maybank, respectively.

($1.00 = RM4.09)