HSBC Considering Purchase of Aviva’s Asia Business
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HSBC Holdings is considering a bid for Aviva’s Asian operations, as it looks for ways to diversify its business in the region.
London-based HSBC is in the early stages of weighing an offer for at least part of Aviva’s Asian business. A deal would help HSBC bolster its insurance presence in Singapore and other parts of Southeast Asia, Bloomberg reported, quoting people familiar with the matter. There’s no certainty the deliberations will result in a transaction, the people added.
Hong Kong, where HSBC generates more than half of its pretax profit, has been roiled in recent protests, leaving shareholders and staff concerned about the lender’s growth prospects. Its tense relations with Beijing over the Huawei incident has fuelled other sets of concerns.
Aviva, the UK insurance conglomerate has announced its intention to put up its Asian business for sale, as part of new chief executive’s Maurice Tulloch turnaround strategy for the firm. The company’s operations in the region could be valued at about $3 billion to $4 billion.
Other suitors are also considering bids for the Aviva assets, the people told Bloomberg. Representatives for HSBC and Aviva declined to comment.
Questions & Answers
Q.Why is HSBC interested in acquiring Aviva's Asian operations?
Why is HSBC interested in acquiring Aviva's Asian operations?
HSBC is exploring this acquisition to diversify its business in the region. Buying Aviva's Asian business would help bolster HSBC's insurance presence, particularly in Singapore and other parts of Southeast Asia, as it looks to strengthen its regional footprint.
Q.What issues is HSBC currently facing in its primary profit region?
What issues is HSBC currently facing in its primary profit region?
HSBC generates over half its pretax profit in Hong Kong, which has recently experienced protests. This situation, along with tense relations with Beijing over the Huawei incident, has raised concerns among shareholders and staff about its growth prospects.
Q.Why is Aviva selling its Asian business?
Why is Aviva selling its Asian business?
Aviva is selling its Asian business as part of a new turnaround strategy initiated by its chief executive, Maurice Tulloch. The UK insurance conglomerate has publicly announced its intention to put these operations up for sale.
Q.What is the estimated value of Aviva’s Asian business?
What is the estimated value of Aviva’s Asian business?
The company's operations in the region could be valued at approximately $3 billion to $4 billion. However, there is no certainty that HSBC's deliberations will result in a transaction, and other suitors are also considering bids.
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