Fairfax Financial Holdings Ltd. (TSX:FFH) is expanding its presence in Asia by taking a 35% stake in Vietnamese insurer, BIDV Insurance Corp. JSC (BIC).
The firm’s wholly owned subsidiary, Fairfax Asia Ltd., has agreed to acquire approximately 35% of BIC through a secondary offering of newly issued shares. The price for the deal was not disclosed.
BIC is a non-life insurer based in Vietnam. In 2014, it generated consolidated gross written premiums of approximately US$60 million. The firm boasts an exclusive bancassurance arrangement with its largest shareholder and one of the largest banks in Vietnam, the Bank for Investment and Development JSC.
“We are looking forward to strategically investing in BIC and working with Pham Quang Tung, the chairman of BIC, utilizing the best practices of Fairfax so that BIC will become the leading non-life insurer in Vietnam,” said Prem Watsa, chairman and CEO of Fairfax. “BIC has a very strong presence in Vietnam, as well as Cambodia and Laos, and this is a great opportunity for us to expand in the region with a partner with a strong history of growth and focus on profitability.”
The transaction, which is subject to regulatory approval in Vietnam, is expected to close in the third quarter of 2015.