Insurance Australia Group Ltd · ASX:IAG
Insurance Australia — Merger or Acquisition (August 2011)
11 slides from Insurance Australia's merger presentation, Aug 15, 2011
Slide 1: IAG Invests in China's Bohai Property Insurance
IAG INVESTS IN CHINA’S BOHAI PROPERTY INSURANCE Mike Wilkins Justin Breheny Managing Director & CEO, Asia Chief Executive Officer 15 August 2011 Insurance Australia Group Limited ABN 60 090 739 923
Slide 2: Agenda
AGENDA 1. TRANSACTION HIGHLIGHTS 2 STRATEGIC RATIONALE 2. 3. CHINA’S INSURANCE MARKET 4. BOHAI PROPERTY INSURANCE – THE RIGHT PARTNER 5 STRUCTURED TO DELIVER VALUE 5. 6. SUMMARY Page 2 IAG INVESTS IN CHINA’S BOHAI INSURANCE | AUGUST 2011
Slide 3: Transaction Highlights
TRANSACTION HIGHLIGHTS STRATEGIC HOLDING TO PROVIDE IAG ATTRACTIVE MARKET ENTRY TO CHINA • IAG has agreed to acquire a 20% equity stake in Bohai Property Insurance Pty Ltd • Provides a platform for growth with a carefully selected partner, in China’s fast growing general insurance market • Structure
Slide 4: Strategic Rationale
STRATEGIC RATIONALE CHINA – STRONG GDP GROWTH; THE WORLD’S MOST POPULOUS COUNTRY CHINA GDP (US$ BN) 7,000 16% STRONG MACRO-ECONOMIC INDICATORS 14.2% 6,009 6,000 14% 5,000 12.7% 4,595 4,993 12% • Strong economic fundamentals: 10.0% 10.1% 4,000 9.9% 3,639 10.3% 10% – 2010 GDP grew in i excess off 10.3
Slide 5: China's Insurance Market
CHINA’S INSURANCE MARKET CONTINUED STRONG GROWTH CHINA P&C GWP (US$ MN) 60,804 POSITIVE TRENDS CONTINUE 43,831 • General insurance market: 3 92 35,792 – 7th largest l t in i the th world, ld growing i 33% from f 28,557 2009 20,238 13,587 15,875 – Forecast to grow 10–15% p.a. over next 10 9,404 10,50
Slide 6: Bohai Property Insurance – An Attractive Partner
BOHAI PROPERTY INSURANCE – AN ATTRACTIVE PARTNER STRONG STRATEGIC FIT PRODUCT MIX (% GWP) BOHAI PROPERTY INSURANCE • Licenced in 2005 • Annualised GWP currently in excess of A$200m $ • On track to operating profit by FY2014 • Strongly g y capitalised p • Motor focus (c. 90% total book) • Broad distr
Slide 7: Bohai Property Insurance – Regional Focus
BOHAI PROPERTY INSURANCE – REGIONAL FOCUS STRATEGIC FOCUS ON INTERNATIONALLY SIGNIFICANT PAN-BOHAI REGION STRONG REGIONAL ECONOMICS Bohai Insurance branch network – GDP By Province Comparison 2010 2010 strategic focus on faster Province (B USD) Country ((B USD)) development in pan-Bohai region Shand
Slide 8: TEDA – Majority Shareholder
TEDA – MAJORITY SHAREHOLDER TRACK RECORD OF SUCCESSFUL ENTERPRISES • Bohai Insurance is majority owned by group of Tianjin Economic-Technological Economic Technological Development Area (TEDA) companies, ultimately led by Tianjin TEDA International Holdings (Group) Co Ltd (TEDA International) • TEDA
Slide 9: Bohai Property Insurance – A Strong Partner
BOHAI PROPERTY INSURANCE – A STRONG PARTNER MEETS IAG’S INVESTMENT CRITERIA Growth G th potential t ti l Regional development strategy in profitable segments Financially attractive Improving profitability Conservative reserving Aligned with IAG approach Distribution Multi channel distributio
Slide 10: Bohai Complements IAG's Portfolio of Asian Businesses
BOHAI COMPLEMENTS IAG’S PORTFOLIO OF ASIAN BUSINESSES SUPPORTS TARGET OF GENERATING 10% OF GROUP GWP FROM ASIA BY 2016 CHINA INDIA Ownership: 20%* GWP1: $204m Ownership: 26%, with option to increase to 49% GWP growth2: 21% GWP1: $15m * Once IAG’s investment in Bohai Insurance is complete. MALAYSIA T
Slide 11: Questions
QUESTIONS Insurance Australia Group
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