Hong Kong int'l insurer FWD cancels New York IPO, raises $1.4bn from global investors

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Hong Kong int'l insurer FWD cancels New York IPO, raises $1.4bn from global investors

Asia-focused international insurer FWD Group is to cancel its longstanding plans for a $2bn-£3bn New York IPO listing, according to multiple media sources.

The Hong Kong-headquartered insurer backed by billionaire Richard Li Tzar-kai instead announced on 14 December that it will raise $1.425bn in a private share placement expected to complete later this month to global investors including Apollo, CPPIB, Swiss Re and Siam Commercial Bank.

Other investors include Li's Pacific Century Group, Metro Pacific Investments Corp and the Li Ka Shing Foundation, which is controlled by Li's father.

These latest investments in FWD reflect a recognition of our ability to continue our strong growth momentum in the attractive Asian life insurance sector."

According to a source cited by the South China Morning Post, FWD plans to sell shares in Hong Kong in the first half of 2022, dropping its listing plan in New York. Reuters also reported that the initial public offering will now be carried out in Hong Kong, according to two sources.

In the official statement referring only to the private placement, Huynh Thanh Phong, group chief executive and executive director of FWD, said, "We're very excited to welcome new and existing partners to invest in FWD. They bring significant expertise and extensive network to support our continued growth and enhance our distribution and investment capabilities. These latest investments in FWD reflect a recognition of our ability to continue our strong growth momentum in the attractive Asian life insurance sector.

"Our strong performance has continued into 2021, with our value of new business1 growing 45%2 YoY in 1H21, followed by a 21%2 YoY growth in 3Q21, driven by strong organic growth during this period which is particularly impressive given the challenging operating environment including the impact of COVID-19 in several of our key markets."

In early November 2021, FWD told US regulator SEC in a statement that it could not guarantee that China would not seek to "intervene or influence" its operations, adding to its list of risk factors as it tried to push ahead with a New York listing.

"We are a Hong Kong-based company with no substantive operations in mainland China. However, we cannot guarantee that the PRC government will not seek to intervene or influence our operations at any time," it said.

On its website, the insurer bannered its marketing message to customers as "We're flying the flag for a new approach to an old industry."

It further said: "At FWD, we're a different kind of insurance company. Led by our customers. Empowered by technology. We focus on today's customer needs and tomorrow's customer trends. Because the things that matter to them, matter to us."

FWD Group spans Hong Kong SAR & Macau SAR, Thailand, Indonesia, the Philippines, Singapore, Vietnam, Japan, Malaysia and Cambodia, offering life and medical insurance, general insurance, employee benefits, Shariah and family takaful products across a number of its markets.