Congrats to all Income Insurance Ltd shareholders! The former NTUC Income Co-operative- which has just recently completed its corporatisation in September 2022- announced that German financial services giant Allianz plans to acquire 51% of its share at S$40.58 per share. Considering the fact that many shareholders got their share at S$10 par value (plus the 5%+ dividends over 20 yrs) and considering recent transaction on an exchange setup by Phillips Securities is at around S$20 per share, the S$40.58 offer is a whopping +400% and +100% to cost price and recent transacted price respectively.
What happens next?
First and foremost, the above offer must be approved by our local regulator. Next, the offer needs to be approved by shareholders of Income Insurance and an EGM thus needs to be convened. The major shareholder of Income Insurance, NTUC Enterprise Co-operative has undertaken to sell part of its shares should the sales of shares by minority retail shareholders falls below the 51% required by Allianz. So, we can tell that the management of Income Insurance has given priority to minority shareholders who would want to exit. More details should be announced soon.
Do note that since the announcement of this deal, ex-CEOs of NTUC Income Co-operative have came out expressing their opposition to the sales of shares by controlling shareholder NTUC Enterprise. Even the influential Prof Tommy Koh (ambassador-at-large at the Ministry of Foreign Affairs, a position he has held since 1990, and a professor of law at the National University of Singapore) is now challenging NTUC Enterprise Chairman Lim Boon Heng’s justification for selling away their majority stake in Income.
Parting thoughts
During late May’24 portfolio review and update, I have stated that I will be keeping my small holding of 106 shares of Income Insurance as a souvenir as the amount is extremely small and then live with its 5%-6% yearly dividend yield. However, with a S$40.58 offer, this paltry investment has suddenly grown from a mere S$1,060 to S$4,300. I guess I will definitely sell if off and then reinvest the proceeds into the Endowus bond funds.
Yeah, this is a sincere offer, shame of those OCBC guys for their Great Eastern offer.
ReplyDeleteHi Rich, yup the Allianz-Income Insurance deal is definitely a very attractive offer. GE and OCBC one I got a bit stumped by the opinion from the independent financial advisor: "NOT fair but reasonable".
DeleteHi bro BK.
ReplyDeleteHave you received this year's dividend yet? I heard it was given last month but I didn't receive.
I thought as a policy holder, we can only buy 20 shares. How come you have 106 shares?
Hi Bro Henry, good day to you. Yup, dividends paid out on 19 June 2024. You should also have received a letter from Income Insurance.
DeleteThe 20 shares you mentioned sounds like NTUC Fairprice shares wor as a Union member. Not sure whether we are talking apple to apple. Anyway during my time 20 years back, I recalled can buy quite a number subject to a limit but definitely higher than 20 shares. On hindsight, I regretted not opting for more shares during my initial purchase. Subsequently, I put myself on the waiting list (as a potential buyer for those wanting to sell their shares) but NTUC Income never contacted me at all.
Morning bro.
ReplyDeleteI went to dig my museum. It stated NTUC Fairprice shares. I bought this in 1991 together with a Life Policy from an Income agent. So I had the impression all along that it's Income shares. So it's a different share?
If it's different, why was I offered Fairprice and not Income shares? I bought more than 10 policies from them the last 3 decades. Still holding 4 now. Amazing..lol.
Hi Bro, 10 is a lot….haha. I am currently only holding on to 2 policies.
DeleteMay I know how did you get the Income shares?
ReplyDeleteHi Bro Henry, if I recalled correctly then, one would need to contact the Secretary of NTUC Income and indicate interest. Then they will arrange the issuance of shares. I subscribed to 100 then. Got another 6 shares from bonus shares declaration in the past.
DeleteI think mystery solved. I was on a different planet. Lol.
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