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Photo = Samsung Life provided |
[Alpha Biz= Paul Lee] Samsung Life Insurance has stated that it is not planning to purchase additional shares of Samsung Fire & Marine Insurance (Samsung Fire) after moving forward with its plan to make Samsung Fire a subsidiary. The company clarified that there will be no increase in its stake to 20% in order to create synergies for management decisions or accounting purposes after the subsidiary acquisition.
Lee Wan-sam, Samsung Life's Chief Financial Officer (CFO), explained during the 2024 earnings call that despite the acquisition, there will be no changes to profitability or capital ratios, and the company does not anticipate any major shifts in operations following the subsidiary status of Samsung Fire. He also addressed inquiries about additional share purchases for synergies post-acquisition, stating that there are no such plans at present.
However, he emphasized that the companies are already generating synergy within the legal framework, citing the healthy competition in the health insurance sector between the two firms. He mentioned the current collaboration in areas such as cross-selling through agents and joint investments in domestic and international alternative assets, which are legally permitted.
Earlier this month, Samsung Life applied for approval from the Financial Services Commission to acquire Samsung Fire as a subsidiary, in line with Samsung Fire's value-up plan announced last month. This move will raise Samsung Life’s stake in Samsung Fire as the latter reduces its treasury stock to enhance shareholder returns.
The acquisition of Samsung Fire as a subsidiary will also allow Samsung Life to exceed the legal limit of holding a 15% stake in the company without any regulatory issues.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
