ING seeks suitors for Asian life-insurance business

HONG KONG - ING has sent out information booklets for the sale of its Asian life-insurance business to some potential suitors and asked them to submit first-round bids by the third week of next month, sources told Reuters.

ING is selling the insurance- and investment-management businesses separately, in a deal that could fetch in excess of US$6.5 billion (S$8 billion), sources said.

Information memorandums (IMs) contain financial details of the businesses being sold, which will help suitors arrive at their bid values.

By sending out IMs, the bailed-out Dutch bank and insurer has set in motion an auction which has generated interest from global insurers keen to get a foothold in Asia's rapidly growing insurance industry.

"The starting gun has kind of gone off," one person familiar with the matter told Reuters.

At least a dozen global and Asian insurers - including Metlife, Prudential Financial, Manulife Financial Corp and AIA Group - have expressed interest in participating in the auction, sources said.

ING must spin off its insurance- and investment-management operations by the end of next year, in return for European Commission approval for 10 billion euros (S$16.5 billion) of Dutch state aid received in 2008.

An ING spokesman in Hong Kong declined to comment. Sources declined to be identified as the sale process is confidential.

The investment-management business is being sold in a separate auction and the IMs for that sale are expected to go out this week, sources added.

Some analysts estimate the investment-management business to fetch US$500-600 million.

While ING's preference is to sell the whole Asian life-insurance operations in seven countries in one deal, it will allow suitors the option to bid for some specific operations, sources added.

South Korea and Japan account for about two thirds of ING's Asian business but Japan may prove to be a stumbling block in the auction due to the 18 billion euros' worth of high guarantee variable-annuity policies the Japan operation has on the books.