Fullerton to manage S$23b of NTUC Income assets in proposed strategic partnership

Under the partnership, Fullerton Fund Management Company (FFMC) Holdings will issue new shares to NTUC Income, giving Income a significant minority stake in FFMC, while Temasek remains as the majority stakeholder.
Under the partnership, Fullerton Fund Management Company (FFMC) Holdings will issue new shares to NTUC Income, giving Income a significant minority stake in FFMC, while Temasek remains as the majority stakeholder.PHOTO: NTUC INCOME TAMPINES JUNCTION

SINGAPORE - Local insurer NTUC Income announced on Thursday (Dec 7) a proposed strategic partnership to appoint Temasek-owned Fullerton Fund Management Company as the investment manager of its portfolio assets estimated at some $23 billion.

Under the partnership, Fullerton's holding company, FFMC Holdings Pte Ltd, will issue new shares to NTUC Income, giving Income a significant minority stake in FFMC, while Temasek remains as the majority stakeholder.

The companies noted that the proposed transaction is not a merger and that both firms will remain as independent entities, guided and managed by their respective board of directors.

If successful, the partnership will make Fullerton one of the largest locally-owned asset management companies in Singapore, with its assets under management (AUM) increasing to over S$40 billion, up from S$17.3 billion as at Sept 30, 2017.

Said NTUC Income chief executive Ken Ng: "As a responsible and forward-looking organisation, Income is always looking out for opportunities to create more value for our policyholders. We believe this proposed partnership with Fullerton is in our best interest to leverage economies of scale and tap the established and deep investment expertise of our combined investment capabilities to serve our policyholders better."

In addition, pooling together investment capabilities will create more oppportunities to explore innovative investment products and solutions for their clients, Income and Fullerton said in a joint media release on Thursday.

To ensure continuity in the management of assets in both firms, relevant Income fund management employees will be transferred to Fullerton.

"The combined depth and experience of the investment team will enhance Fullerton's competitive positioning and is set to benefit current and future customers of Income and Fullerton," the firms added.

Completion of the proposed transaction is still subject to regulatory approvals and other customary closing conditions, the companies said.