ING Groep NV
) announced to sell its lucrative Thailand Asset management
business to Singapore's United Overseas Bank Ltd. The divestment
is likely to fetch about $12.8 million (€10 million) in cash. The
company is offloading its Asian operations to repay the state
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It is estimated that the Thai division managed nearly $3.7
billion worth of assets as of September end this year. However,
there is no official word on the closure of the deal from either
of the parties.
Credit Suisse Group
Nomura Holdings, Inc.
) acted as the chief advisors to ING Groep and United Bank,
After having failed to find a single buyer for its Asian
operations, ING Groep is now selling its operations regionally.
The disposal of the Thai division leaves the company with its
asset management operations in South Korea, Hong Kong, Malaysia,
Taiwan, Japan, India and Singapore. ING Groep's Thai investment
management unit is the third largest of its Asian fund management
units. South Korea is the largest and Taiwan is the second
largest of the units.
As per ING Groep's regulatory filings, its Asia investment
management business has a book value of €200 million and controls
about €43.3 billion worth of assets.
ING Groep is aiming to divest all its Asian assets, especially
the insurance and investment-management businesses by the end of
2013. This is mainly for the repayment of $13 billion (€10
billion) state financial aid, which the company received from the
Dutch government during the financial crisis in 2008. The company
also plans to vend its banking assets to accelerate repayment of
the remaining amount of roughly $3.9 billion (€ 3 billion) with
The selling of Thai operations is the latest deal that the
company entered with an aim to sell off its Asian assets. Earlier
in October, it had announced a deal to vend its lucrative
Malaysian insurance business to Asian insurance giant AIA Group
Ltd. for approximately $1.7 billion (€1.3 billion).
Apart from this, ING announced the divestiture of its insurance
business, pension and financial planning divisions in Hong Kong
and Macau, as well as its life insurance operations in Thailand
to Pacific Century Group for a total of $2.14 billion (€1.64
billion) in cash.
In the same month, it also announced a deal to sell its entire
stake in China Merchants Fund (CMF) to the joint venture partners
of the fund - China Merchants Bank and China Merchants Securities
Co. Ltd. The deal will bring $128 million (€98 million) in cash
to ING and is expected to be completed in the second quarter of
2013, subject to certain regulatory terms and conditions.
Other Global Divestments
Besides selling its Asian businesses, ING Groep has offloaded a
couple of its other global businesses in the last few quarters to
streamline the operations and focus mainly on core banking
activities. Last month, it agreed to sell ING Direct UK - its
British online banking division - to UK banking giant
Earlier, in August, ING Groep announced the sale of ING Direct
Canada - the Internet banking division of ING Bank of Canada - to
The Bank of Nova Scotia
). Further, in February 2012, it completed the sale of its online
banking unit, ING Direct USA, to
Capital One Financial Corp.
We believe these deals will help ING Groep repay its bailout dues
soon. Further, it will enable the company to focus more on its
core businesses amidst a bleak macroeconomic environment.
ING Groep currently retains a Zacks #4 Rank, which translates
into a short-term Sell rating.