OCBC Bank cancels sale of stake in Hong Kong Life Insurance for HK$2.4b

OCBC Bank said the closing conditions had not been satisfied by the long stop date of Sept 30.
OCBC Bank said the closing conditions had not been satisfied by the long stop date of Sept 30.PHOTO: ST FILE

SINGAPORE - OCBC Bank on Monday (Oct 1) announced it has terminated the sale of its 33.33 per cent stake in Hong Kong Life Insurance Limited, one of the last remaining independent life insurance businesses in the territory, saying that closing conditions had not been met before a deadline.

The long stop date for the deal had been Sept 30,  OCBC said on Monday, after the deadline was extended from March 20, 2018.

The bank did not provide details on what conditions were not met or why the long stop date had not been further extended.

In accordance with the terms of the share sale agreement, the buyer, First Origin International Limited, has forfeited its deposit of HK$710 million (S$124 million) to the seller, one of which is OCBC's subsidiary OCBC Wing Hang Bank Limited.

OCBC Wing Hang Bank first announced in March 2017 that it would sell its 140 million ordinary shares in Hong Kong Life for HK$2.4 billion (S$419 million) to First Origin International.

Following the sale, Hong Kong Life would have ceased to be an associated company of OCBC Wing Hang Bank and OCBC Bank, and OCBC Wing Hang Bank would enter into a distribution agreement to distribute Hong Kong Life's products in Hong Kong.

Since the sale has been terminated, OCBC Wing Hang Bank will retain its stake in Hong Kong Life.