[News Alert] AIA (1299 HK, BUY) announced its acquisition of Blue Cross insurance and Blue Care
AIA (1299 HK, BUY) announced to acquire 100% shares in Blue Cross Insurance Limited (Blue Cross) and 80% shares in Blue Care JV Holdings Limited (Blue Care) from Bank of East Asia (23 HK, BUY), with total consideration of US$278m. Bank of East Asia is expected to recognize HK$1.5bn of disposal gain from the transaction while the financial impact to AIA is considered insignificant.
Blue Cross is an non-life insurance service provider with its products ranging from medical, travel and general insurance to both individual and corporate customers in Hong Kong. Blue Care is a healthcare service provider who owns two medical centers and a city-wide medical network with over 300 affiliated service provider offering consultation, pre-insurance and pre-employment checks and health screening program and services in Hong Kong.
AIA and BEA have further agreed to extend the scope of its existing 15-year exclusive bancassurance partnership to include the distribution of personal line general insurance products via BEA’s network.
We believe the transaction will further strengthen AIA’s “health and wellness” strategy to provide more comprehensive insurance solutions within BEA network which facilitates its deployment in the GBA area. The transaction is also considered positive to BEA, as the extended scope of the bancassurance partnership with AIA to include non-life products will help to further generate fee income to the bank.
