Seoul, South Korea (4E) – Buyout firm MBK Partners Ltd. has agreed to purchase ING Groep NV’s life insurance unit in South Korea for around 1.84tn won ($1.7bn) as the Dutch financial firm tries to meet conditions by European Union regulator.
ING Life Korea, South Korea’s biggest foreign life insurer, employs over 1,000 people, has around 1.3 million customers and roughly 6,800 linked agents.
Under the deal, Amsterdam-based ING will keep an indirect stake of around 10 percent in the life insurance unit for 120bn won. Proceeds of the sale will be used to reduce ING Insurance’s debt.
The decision to dispose its Asian holdings brings ING near the end of its restructuring plan with European Union regulators that forced the company to divest its insurance operations worldwide. The deal is Seoul-based MBK’s biggest acquisition of financial assets, according to data from Bloomberg News.
ING has also reached a licensing agreement with MBK allowing the use of the ING brand for up to five years. Within the first year, ING will also continue to offer advice and technical support to ING Life Korea.
The deal is expected to be completed by the end of 2013 pending approval from regulators, ING said in statement released Monday.