The final attempt of Oversea-Chinese Banking Corp. To fully control Great Eastern Holdings Ltd., with its $ 900 million offer ($ 704 million) will be tested on Tuesday, capping a quest for two decades by the second largest lender in Singapore to take over the insurer.
The OCBC is only 6.28% of the total property, and the minority shareholders of Great Eastern will vote at an extraordinary general meeting of the implementation of the 117 -year -old company with an improved bank offer. If it is rejected, the so-called “outing offer” of OCBC will be launched, paving the way for the actions of the insurer to resume trading.
The acquisition of Great Eastern, one of the largest insurers in Singapore and Malaysia, will stimulate the strategy of the CEO of the OCBC, Helen Wong, aimed at building an integrated financial services group which will better take the growth of the region in full swing of the region of the region. The insurer has a total asset of more than $ 100 billion with 16 million police holders, complementing the activities of the bank.
“The transaction is to rationalize the structure of the group and we also think that it opens the potential to manage the group’s capital more effectively,” said Jayden Vantarakis, head of research on actions for Southeast Asia in Macquarie Capital. However, complete takeover would have a minimum impact on income or strategy because OCBC is already in control, he said.
The Great Eastern actions trade has been suspended since July 2024 after the OCBC has failed to obtain a sufficient level for an acquisition of radiation or compulsory with last year’s offer. While the bank increased its offer by 17.8% last month to $ 30.15 s per share, the price is still a discount by the integrated value of the insurer in $ 38.08 per share.
This metric was used to enhance insurers elsewhere and was cited by resistant minority shareholders urging a higher offer.
The independent directors of Great Eastern advised shareholders to accept the OCBC offer, which was described by the company’s financial advisor as “fair and reasonable”.
The insurer has contributed an average of around $ 700 million per year to net profit at the OCBC in the past 10 years, resulting in an average of 15% of the OCBC annual net profit during this period, the bank said.
Although Great Eastern’s delimitation was a long-term objective for the OCBC, the bank is satisfied with its 93.72%participation, regardless of the EGM result, he said in a statement last month. OCBC does not intend to launch another offer in the foreseeable future, he added.
