RSA selling off units in Singapore and Hong Kong
RSA Insurance is selling its insurance businesses in Singapore and Hong Kong to Allied World Assurance as it retreats from markets and hoards cash.
RSA was forced to pump £200m (€250m) into its Irish unit last year after uncovering a hole in its balance sheet that arose from the historic accounting for claims.
On Friday the London headquartered group said it reached an agreement to sell its insurance business in Singapore and Hong Kong to Allied World Assurance for £130m (€170m) in cash. The sales will result in a gain on sale of about £110m and an addition to the group's tangible net assets of £95m, boosting capital.
Chief executive officer Stephen Hester is seeking to reverse a decade of acquisitions that saw RSA expand in more than 30 countries. The former banker said last month that he's ahead of a three-year plan to remake the insurer as he mulls further asset sales in the wake of an accounting scandal in Ireland last year and a £775m rights issue.
"The transaction builds further on the momentum of our recently announced disposal in the Baltics, Poland, Canada and China and represents continued progress against our aim of tightening the strategic focus of the group," Mr Hester said. "Further disposals are targeted over the next 12 to 18 months to complete this process." (Additional reporting Bloomberg)