Thursday, September 22, 2011

MAA Holdings gets shareholders's nod to sell insurer

KUALA LUMPUR : MAA HOLDINGS BHD [] has obtained its shareholders' approval to dispose its core business Malaysian Assurance Alliance Bhd (MAAB) for RM344 million to Zurich Insurance Co Ltd, which values MAAB at 1.36 times book value.

MAA Holdings'' chairman Tunku Datuk Yaacob Tunku Abdullah'' said on Thursday, Sept 22 although the price tag for MAAB wass considered very low, due to the high capital adequacy requirement sets out by Bank Negara for insurance business, the group's shareholders decided that it is better to dispose MAAB.

He said going forward, MAA Holdings would focus on its takaful business under MAA Takaful Bhd and its asset management business under MAAKL Mutual Bhd.

However, the profit margin for asset management business is considered low, but the group intends to grow its asset value under management which currently stands at RM1 billion to grow its profit.

At the EGM, shareholders approved MAA Holdings name change to MAA Group.'' It will be structured to become an asset management holding company, to acquire stakes in other companies at reasonable price, and later sell it at a rather expensive price.

Tunku Yaacob liken the group's business going forward as more 'like a trader'.

He did not discount any corporate activities to acquire another business to boost the group's profitability going forward, as the current profits derived from its 70% owned MAA Takaful and 75% owned MAAKL Mutual were relatively small compared to profit derived from MAAB prior to the disposal.

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