RSA Insurance offloads Singapore and Hong Kong business to Allied World Assurance in £130m deal
RSA Insurance is selling off its business in Singapore and Hong Kong in the latest deal aimed at getting the British insurer back on track.
Swiss insurer Allied World Assurance will pay £130m in cash for RSA’s insurance operations in the two countries, in a deal expected to be finalised in 2015. It will pay £93m for the Singapore business and £37m for the Hong Kong business, with senior management expected to remain with the respective companies.
RSA said it expects the sale to provide net gains of £110m, and additions of £95m to the group’s net assets.
Newly installed boss Stephen Hester – the former chief executive of RBS – said the deal represented progress for the insurer and further sell offs were likely over the next 12 to 18 months.
“This transaction builds further on the momentum of our recently announced disposals in the Baltics, Poland, Canada and China, and represents continued progress against our aim of tightening the strategic focus of the Group,” said Hester.
The insurer has struggled to recover from an accounting scandal in its Irish business last year, but with Hester in place to “clean up” the company, it announced it was back in the black when it released half year results at the beginning of August.
Pre-tax profits were £69m for the first half of the year compared to a loss £494m loss in the second half of 2013.
RSA shares opened 0.7 per cent higher this morning.