Allianz has announced the withdrawal of its proposal to acquire a majority stake in Singapore’s Income Insurance Ltd.
The decision follows amendments to Singapore’s Insurance Act, which impose stricter requirements for transactions involving cooperative-linked insurers.
The offer, initially revealed in July 2024, aimed to secure at least 51% of Income Insurance through Allianz’s subsidiary, Allianz Europe BV.
In a statement on Dec. 17, Allianz cited the regulatory environment as a key factor in its decision.
Renate Wagner, a member of Allianz SE’s board of management overseeing the Asia-Pacific region, said the company respects the Singapore government’s decision.
“We still believe the combination of Allianz and Income Insurance would result in two strong businesses being brought together for the benefit of Income Insurance’s policyholders and a growing portion of Singapore’s customers. We regret having to make this decision, but we will, without question, carry on supporting the Singapore insurance market’s continued growth and success,” she said.
Despite the withdrawal, the company reaffirmed its commitment to Singapore and the Asia-Pacific region, emphasising that it remains a strategic growth market.
The withdrawal follows scrutiny from the Singapore government, which raised concerns over the proposed deal.
In October 2024, Edwin Tong, Singapore’s Minister for Culture, Community, and Youth, said that the acquisition could jeopardise Income Insurance’s social mission.
Established in 1970 as NTUC Income Insurance Cooperative Limited, the insurer was corporatised in 2022 to improve competitiveness while retaining its role in offering affordable insurance.
A government review of Allianz’s proposal flagged issues with the planned capital optimisation measures. The proposal included withdrawing $1.85 billion from Income Insurance’s capital within three years of the acquisition, raising concerns about the insurer’s financial resilience and ability to meet its public service commitments.
Despite assurances from Allianz and NTUC Enterprise, which holds a 72% stake in Income Insurance, the government found no binding mechanisms to safeguard the company’s social mission after the acquisition.
In response to the deal, Singapore lawmakers introduced amendments to the Insurance Act in October.
The changes require transactions involving insurers linked to cooperatives to receive approval from both the Monetary Authority of Singapore (MAS) and the relevant government ministry.
Chee Hong Tat, Singapore’s Minister for Transport and deputy chairman of MAS, noted that the amendments were introduced urgently due to the ongoing shareholder considerations surrounding the proposed acquisition. He added that the legislative change aims to ensure that such transactions align with public interest objectives.
The Asia-Pacific region continues to be a key growth area for Allianz, which reported €7.7 billion in business volume from its regional operations in 2023.
Despite the setback, the insurer expressed confidence in its ability to expand within the region and reaffirmed Singapore’s importance as a financial hub.
“We have full confidence in the future strength and potential of our existing operations across the region, and we look forward to continuing to deliver exceptional value to our customers and partners across Asia Pacific,” Wagner said.
