PacificMas in Talks With Fairfax Asia on Sale of Insurance Unit

Malaysian investment holding company PacificMas Bhd. said it is in talks with Fairfax Asia on the proposed disposal of its entire equity interest in its wholly owned general insurance subsidiary Pacific Insurance Bhd.

Prior to announcing the potential buyer, PacificMas discontinued its negotiations with Great Eastern Group, a Singapore-based financial institution that it had been in discussions with for the proposed sale of its insurance unit since April 21, 2010, said PacificMas in a statement.

PacificMas did not comment further on the termination of discussions with Great Eastern, and did not provide a schedule for the completion of the proposed sale.

In July, PacificMas decided to terminate discussions on the sale of Pacific Insurance with another Singapore-based company, Tokio Marine Asia, a subsidiary of Japan-based Tokio Marine Holdings Inc.

The potential sale of Pacific Insurance reflects a change in the business strategy of its investment parent, as general insurance had been the core business of Malaysia-listed PacificMas, according to Pacific Insurance (BestWire, July 29, 2010).

As at June 30, PacificMas reported first-half profit attributable to ordinary equity holders of the parent of 14.35 million ringgit (US$2.11 million), down 7.1% from 15.44 million ringgit in the correspondent period of 2009.

Fairfax Asia is an Asian insurance unit of Canada-based Fairfax Financial Holdings Ltd., a financial services holding company that is engaged in property/casualty insurance, reinsurance and investment management through its subsidiaries.

(By Rebecca Ng, Hong Kong news editor: Rebecca.Ng@ambest.com)