Asia-based investment firms RRJ Capital, Singaporean sovereign wealth fund Temasek and one of its subsidiaries, SeaTown Holdings, have together agreed to invest €1.275 billion ($1.77 billion) in NN Group, the European and Japan insurance and asset management operations of Dutch life insurance company ING Group, according to a statement.
ING has agreed to sell NN shares to the three investors at an IPO of the company expected this year, the statement said.
Under the agreed terms, ING will receive cash amounts of €750 million from RRJ Capital, €425 million from Temasek and €100 million from SeaTown for NN Group shares at the time of intended IPO, as well as subordinated ING Group notes, mandatorily exchangeable into NN Group shares over time.
The firms will make an anchor investment at the time of the IPO of €150 million, with ING issuing the mandatorily exchangeable subordinated notes worth €1.125 billion in May.
“We are delighted with the commitment of RRJ Capital, Temasek and SeaTown to make these substantial investments into NN Group ahead of the intended IPO,” said Ralph Hamers, chief executive of ING Group.
“This is a strong sign of the belief of each of these institutional investors in the attractiveness of NN Group as an investment proposition and of their confidence in the prospects of NN Group as an independent company.”
ING Group has agreed certain arrangements with the investors, which will be disclosed in the IPO prospectus when published, although RRJ Capital, Temasek nor SeaTown will have any special governance rights in NN Group following the transaction.
The deal comes less than a year after MBK Partners, a Seoul-based private equity firm, acquired ING’s Korea operations in a $1.65 billion deal, in which ING retained a 10 percent stake, Private Equity International reported earlier.
ING Group had committed to divesting half of its Asia portfolio by the end of 2013 following its 2008 bailout, and as a result has been divesting a number of its offshore units, including those in Canada, Australia and New Zealand, and Latin America, as well as a large portion of its investment management activities in Asia over recent years.
The sale of its Japan unit was the last step in order to satisfy its agreement with European Union regulators to offload more than 50 percent of its Asia operations before the end of 2013, media reports previously said.