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Samsung Life, KB may seek alliance to buy ING unit

By Kim Yon-se

Published : March 11, 2012 - 20:30

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Samsung targets Asian markets; KB seeks growth at home


Samsung Life and KB Financial Group may seek to form a strategic alliance if ING Group’s Asia-Pacific unit goes up for sale, market observers said.

Analysts have said the two financial companies are not competitors as Samsung and KB target different units ― overseas and local, respectively.

ING Group’s project to sell its Asia-Pacific operations coincides with Samsung Life Insurance’s strategies for global expansion.

Under the reported instruction of its parent Samsung Group, Samsung Life has been striving to seek future growth potential in overseas markets as Korea’s insurance market is saturated.

Last week, Samsung Life CEO Park Keun-hee unveiled the company’s goal of becoming one the top 15 in the global life insurance industry by 2020.

Its project involves the long-term vision of overseas sales of 27 trillion won ($23.6 billion) from the current 100 billion won.

Park stressed the necessity of expanding its presence in the Asian market and tapping developed nations.

The Netherlands-based ING Group has operations in seven Asian markets ― Korea, Japan, China, Hong Kong, India, Malaysia and Thailand.

In late February, Samsung Life clarified that it is interested in bidding for ING’s Asia-Pacific operations.

Park’s revelation came two days after KB Financial Group chairman Euh Yoon-dae expressed the group’s M&A interest toward ING’s Korean unit.

While Samsung is still taking a low-key stance, KB Financial recently selected HSBC Securities as the investment advisor for the coming ING units auction.

“If ING Life sells off only the ING Korea unit, KB Financial could participate in the coming bidding as a single bidder,” Euh said.

But if the company chooses to sell its entire Asia-Pacific operations, KB Financial will have to seek a bidding partner, like Samsung Life, he added.

The financial group, whose flagship unit is Kookmin Bank, is considering strengthening its non-banking sector.

As the Dutch group’s Korean insurance unit ranks fifth or sixth in the local market, heated competition is expected if it is put up for sale.

Over recent decades, the local insurance sector has mostly focused on Korean customers despite saturated market conditions.

Now financial regulators also actively support the idea of insurers’ advancement into overseas markets. They could be strong sponsors for local firms going global.

Last year, Korea hosted the 18th annual conference of the International Association of Insurance Supervisors.

The conference provided Korean firms such as Samsung Life and Korea Life with opportunities for building investor relations.

By Kim Yon-se (kys@heraldcorp.com)