Bangkok Life all set for IPO
Written by Admin on Wednesday, September 3rd, 2008
INSURANCE
Bangkok Life all set for IPO
CHAROEN KITTIKANYA
Bangkok Life Assurance Plc, an affiliate of Bangkok Bank, is committed to moving ahead with an initial public offering this year, despite intensifying political unrest and unfavourable economic conditions. ”The planned share sale is now pending consideration by the Securities and Exchange Commission (SEC),” said managing director Chan Vathanakul.
Bangkok Life plans to sell 200 million new shares to the public, representing 16.33% of the company’s total paid-up shares at one baht par each.
Proceeds will be used for working capital, for bolstering the insurer’s capital fund and ensuring its financial stability, as well as for future business expansion.
According to a filing with the SEC, Bangkok Bank and the founding Sophonpanich family would have their combined holdings in Bangkok Life diluted by the IPO from 47.9% to 39.9%. The stake of Japan’s biggest insurer, Nippon Life Insurance Co, would be diluted from 25% to 20.83%.
Bangkok Life, which was converted to a public company early this year, has appointed Capital Nomura Securities Plc as its financial adviser. Capital Nomura and Bualuang Securities are also the joint lead underwriters.
Bangkok Life offers both individual and group insurance. Ordinary life insurance produced 2.566 billion baht in new business last year, with group life generating 675.15 million. Total revenue last year was 14.42 billion baht, including 12.29 billion from underwriting and 1.984 billion from investment.
As of Dec 31, 2007, the company had total assets of 44.4 billion baht, a rise of 21.31% from a year earlier. Investment assets contributed 95.18%, or 42.26 billion baht. Liabilities totalled 41.33 billion baht.
Bangkok Life posted a strong net profit the last three years. It earned 769.98 million baht last year, 652.34 million in 2006 and 392.93 million in 2005.
For the first six months of this year, the company reported a net profit of 500.86 million baht, a slight drop of 0.15% from the same period last year. Revenue for the period increased 25.38% from 6.18 billion baht to 7.75 billion.
For the second quarter, the company posted a net profit of 295.87 million baht, a rise of 40.26%, with total revenue up 37.06% to 4.21 billion baht.
According to Mr Chan, increased revenue stemmed from higher net-written premiums, especially bancassurance.
