Sumitomo Life to buy Singlife stake from TPG for $1.6 billion

Sumitomo Life Insurance Company plans to take full control of (SingLife), with an offer of $1.6 billion.

Sumitomo Life Insurance Company (Sumitomo Life) plans to take full control of Singapore Life Holdings (SingLife), with an offer to buy out fellow shareholder TPG’s 35% stake for $1.6 billion, and to make an offer to the remaining shareholders.

The transaction values SingLife at $4.6 billion, marking it as one of the largest insurance deals in Southeast Asia to date.

This agreement follows Sumitomo Life's earlier acquisition of Aviva plc's stake in Singlife, first announced on Sept 13. The transactions are anticipated to conclude in the first quarter of 2024, pending regulatory approvals in Japan and Singapore.

Having invested in Singlife since 2019, Sumitomo Life considers Singapore a crucial component of its Southeast Asia strategy. With total assets of some $14.4 billion as at Dec 31 2022, Singlife says it is among the top six insurers here in Singapore.

The acquisition is expected to enhance the earnings of Sumitomo Life's international business portfolio. 

Sumitomo Life plans to keep Singlife's existing operations, including its name, brand and management team. Customers can expect no disruptions as a result of this ownership change. 

“What it means for Singlife as a business is that we will have a simple shareholding structure and have access to funds to support our business needs,” says Singlife CEO Pearlyn Phau in a message on the company’s website.

“This will allow us to continue to grow, invest and develop new products and services for customers,” she adds.

Ray Ferguson, Singlife chairman, expressed satisfaction with the agreement, emphasising the growth journey Singlife has experienced, evolving from a small insurtech startup to a key player in Singapore's insurance and financial services industry. 

“As a subsidiary of Sumitomo Life, we will have access to capital, a nimble shareholding structure, and be at the centre of a strategic plan to provide financial planning solutions for consumers in Southeast Asia,” he adds.

Yukinori Takada, Sumitomo Life president and CEO says that Singlife has been steadily expanding on the strength of its digital enabled business with a wide range of products and sales channels. 

“We have had a very good relationship with the Singlife management team and want to support their growth,” he adds.

According to Sumitomo Life, following this transaction, it will set up a local office in Singapore in April 2024 to “strengthen relationship with Singlife and conduct market research in the region.”

Down the road, Sumitomo Life might set up a regional headquarters in Singapore to further its expansion plans for Asia.