Through this partnership, Prudential's life insurance products will be distributed through UOB Group's bank branches across Singapore, Indonesia and Thailand. In addition, Prudential is to acquire UOB Life Assurance in Singapore.
The total consideration for the acquisition in Singapore, which will be settled in cash on completion, is S$428 million (£192 million), subject to a post-completion adjustment to reflect the net asset value as at the completion date.
This 12-year bancassurance partnership will enable Prudential to market and distribute its investment, savings and protection insurance products through the UOB Group's 414 bank branches in Singapore, Thailand and Indonesia.
The acquisition of UOB's life insurance operation will consolidate Prudential's position in Singapore, where Prudential is already a leading life insurer with strong distribution capabilities through tied agency and distribution partners. The combination of UOB Life Assurance with Prudential's existing businesses will enhance that position.
Tidjane Thiam, Group Chief Executive, Prudential, said:
"Our agreement with UOB enhances our presence in Asia and strengthens our leading regional platform. This bancassurance partnership offers us significant new profitable growth opportunities in Singapore and Indonesia, and substantially increases our scale in Thailand, a key market in the region.
"We have a proven track record of working with partners across Asia and we are delighted to be working with UOB. This transaction will allow us to continue to create significant shareholder value in some of the most dynamic and attractive Asian markets."
Mr. Wee Ee Cheong, Deputy Chairman and Chief Executive Officer, UOB said:
"This partnership marks another step in the Group's continued efforts in building a premier regional bank. The tie-up allows us to leverage our distribution strength and harness the manufacturing expertise of a leading life insurer, to jointly accelerate the growth of our bancassurance business regionally.
"We are delighted to have Prudential as our partner in this development and look forward to working together to deliver greater value to our customers and our stakeholders."
Prudential has life insurance and asset management operations in 13 markets in Asia, with over 11 million life customers and retail funds under management of £16.4 billion at 30 June 2009. In 2008 Prudential's business in Asia accounted for 44 per cent of the Group's EEV long-term operating profits.
