SEOUL, Jan. 29 (Kore Bizwire) – Dongbu Insurance will become the largest shareholder of Vietnam’s Post & Telecommunications Insurance (PTI) by acquiring 37 percent of its shares, investing a total of 50 billion won (US$45.8 million).
Dongbu announced on January 28 that it would sign a contract to purchase the share of the fifth largest Vietnamese property insurance player in the near future, and finish its acquisition within the first half of this year.
As a subsidiary founded in 1998 by Vietnam Post Corporation, PTI is known to be equipped with a nationwide sales network. As of 2013, it took 7.2 percent of market share among 29 players, and it is the third largest automobile insurer in Vietnam.
The market volume of property insurance in Vietnam keeps growing. According market researcher BMI, its property insurance market will grow up to US$1.6 billion this year.
Dongbu Insurance also expects to benefit from synergy effects through Dongbu Capital. As income levels rise in Southeast Asian countries including Vietnam, their demands for automobiles keep increasing. Furthermore, as most individuals buy cars through installment financing, Dongbu Insurance plans to sell automobile insurance while offering installment financing through Dongbu Capital.
Kim Jeong-nam, CEO of Dongbu Insurance, said, “By acquiring PTI, we can establish a business foundation in Vietnam’s insurance market with high growth potential. Based on the acquisition, we will expand our insurance business to the Indo-China subcontinent.”
By John Choi (email@example.com)