NEW YORK (
New York Life's
Hong Kong and Korean life insurance operations for $425 million in cash, according to a company statement.
This is the third acquisition ACE has made within the last two months. Last month ACE purchased
Rain & Hail Insurance Service Inc.
for $1.1 billion and earlier this month bought a Malaysian insurance company
Jerneh Insurance Berhad
for $200 million.
The insurer is likely to continue making acquisitions in Asia and possibly in emerging markets, Paul Newsome, managing director of research at Sandler O'Neill said.
"They probably still have a significant amount of cash to spend," Newsome added.
ACE will use the two Asian life insurance business to expand its presence and offer more products in to Asian markets. The deal is expected to close in the first quarter of next year.
"These are basically startups in a highly competitive market, but this should be a fairly low risk transaction," Newsome said. "The deal is expected to bring in a 15 percent return on equity. ACE had wanted life operations in Asia for at least a year."
--Written by Maria Woehr in New York.
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