MAA, Solidarity sell takaful arm

PETALING JAYA: MAA Group Bhd (MAAG) together with Solidarity Group Holding BSC yesterday agreed to dispose of their entire stake in MAA Takaful Bhd (MAAT) to Zurich Insurance Co Ltd for RM525 million.
In a stock exchange announcement yesterday, MAAG said it is disposing of 75 million RM1.00 shares, representing a 75% stake in MAAT, for RM393.75 million cash. Solidarity’s 25% interest in MAAT will amount to RM131.25 million.
MAAG, which will realise a proforma non-recurring gain on disposal of about RM289.5 million, has proposed an interim special dividend of 35 sen for each RM1.00 share in MAAG.
For illustrative purposes, the special dividend will amount to about RM100.8 million computed based on the current issued and paid-up share capital of MAAG comprising 292.6 million shares and after excluding 4.8 million treasury shares held by the company as at April 29, 2016.
MAAG said it plans to maintain the listing status of the group post the disposal of its core business, and will utilise the remaining proceeds of about RM196.7 million to acquire prospective new businesses and/or assets within 24 months. The company said it has not identified any potential investment opportunities yet.
MAAG is expected to receive the remaining proceeds of the disposal amounting to RM93.75 million on the third anniversary of the completion date of the sale, to be used for future investment or as additional working capital.
MAAG believes that the proposed disposal is timely and is of the view that as a standalone takaful company without banking business nor strategic partnership, the prospects of MAAT will be challenging. “Therefore, the proposed disposal represents a good opportunity for the group, to unlock the value of its investment in MAAT, as well as for MAAT going forward,” it said.
MAAG expects the proposals to be completed by the third quarter of 2016.