ING takeover to boost KB Financial’s life insurance business

KB Financial Group, Inc will soon take ownership of the Korean insurance unit of ING Group.

Sources said negotiations are in their final stages and that KB Financial and ING Group will soon conclude the deal. The takeover price is expected to be a compromise between the US$3.1 billion demanded by ING and the US$2.3 billion offered by KB Financial.

ING Life Korea is the fourth-largest life insurance firm in the country by market share, and is worth around US$3.1 billion. On the other hand, KB Financial’s insurance subsidiary, KB Life Insurance, ranks near the bottom in the life insurance market.

A KB Financial spokesperson, however, said there is a possibility that ING Group will not select KB Financial as the preferred bidder. Instead, the group is expected to hand over the Korean unit through direct negotiations with KB Financial to hasten the conclusion.

The deal includes the sale of KB Life Insurance shares owned by ING Group to KB Financial Group. KB Financial Group currently owns a 51% share of the insurer and ING Group 49%.