Allen & Overy, Cleary Gottlieb Steen & Hamiltion, and Kim & Chang have advised on ING Group’s 1.84 trillion won ($1.65 billion) sale of its South Korean insurance unit to private equity firm MBK Partners.
If completed, it will be South Korea’s largest insurance M&A deal, surpassing the $1 billion purchase of a 24 percent stake in Kyobo Life Insurance last year by a consortium led by private equity firm Affinity Equity.
Under the agreement, the bailed-out Dutch insurer will retain about a 10 percent stake in the South Korean unit and allow MBK to use the ING brand for up to five years.
An Allen & Overy team led by Hong Kong-based Asia-Pacific M&A head Gary McLean advised ING on the deal, with assistance from London partner Richard Evans. Cleary Gottlieb Steen & Hamilton was international counsel to MBK Partners, while Kim & Chang offered Korean legal advice.
The deal, which is subject to regulatory approval, is expected to close later this year.
MBK Partners, which is seeking about $2.6 billion in a new private equity fund, will fund the deal with a one trillion won syndicated loan, Basis Point reported last week. It is the largest private equity firm in South Korea, with more than $8 billion in capital under management.
The sale of the South Korean unit will leave ING with its Japan insurance unit left to sell, bringing it closer to fulfilling its agreement with European regulators to offload more than 50 percent of its Asian operations by the end of 2013, Reuters reported.
Established in 1987, ING Life Korea is South Korea’s largest foreign life insurer, with about 1.3 million customers, more than 1,000 employees and approximately 6,800 tied agents.
Last year, ING sold its Hong Kong, Macau and Southeast Asian insurance operations for a combined $3.87 billion in an auction that generated strong bidding.
Kanishk Verghese is North Asia journalist at ALB. Follow us on Twitter: @ALB_Magazine.
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