ING Fires Starting Gun on European Insurance IPO

NEW YORK (The Deal) -- The Netherlands' ING Groep  (ING) on Thursday, June 5, announced plans for an initial public offering of its NN Group NV insurance subsidiary as it nears the finish line in a five-year mandatory restructuring.

ING said it plans to sell more than half of its stake in NN Group, which, like ING, is based in Amsterdam, before the end of 2015, and the rest before the end of 2016, in line with the timeline agreed with the European Commission as a condition for approving a 2008 government bailout at the start of the credit crisis.

ING CEO Ralph Hamers told a conference call that the offering may take place as soon as next month.

The latest move comes a little more than a year after ING held a $1.3 billion IPO for its U.S. unit, now called Voya Financial (VOYA). ING further reduced its stake in that businesss to 45% in March.

"With the IPO of NN Group, we will have substantially completed the repositioning of ING as a pure bank," said Hamers in a statement.

Shares in ING edged up 0.6% in Amsterdam on Thursday to trade at 10.48. That puts its market capitalization at around 40 billion ($54.4 billion).

As of Dec. 31, NN Group had an embedded value of 10.3 billion, of which the most significant components were Netherlands Life's embedded value of 5.6 billion and the Insurance Europe embedded value of 3.1 billion.


NN Group is the leading life and non-life insurer in the Netherlands, and has a strong life and pensions presence in several other European markets including Poland and Hungary and a growing position in Turkey, according to ING. NN Group's pretax profit from ongoing business was 905 million in 2013, with gross written premiums of 9.53 billion.

The IPO will consist of ING's shares only and will be open to institutional and retail investors in the Netherlands and to institutions in various other jurisdictions.

ING has already lined up three Asian-based investors - Hong Kong-based RRJ Capital, Singapore's state-owned Temasek Holdings and Temasek's SeaTown Holdings Pte Ltd., to participate in the IPO as anchor investors for a total amount of 150 million. The NN Group shares that they snap up at the IPO offer price will not be subject to any lockup.

ING has also issued 1.125 billion worth of mandatory exchange notes to these anchor investors.

JPMorgan Chase (JPM), Morgan Stanley (MS), ING Bank and Deutsche Bank (DB) are joint global coordinators for the IPO.

The joint global coordinators, as well as BNP Paribas, Citigroup (C), Commerzbank AG, Credit Suisse Group and Nomura International Inc., are acting as joint bookrunners for the IPO. ABN Amro NV, HSBC Holdings and RBC Capital Markets are the joint lead managers, while Keefe, Bruyette & Woods and Rabobank International are senior co-lead managers for the IPO.

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