Japan's ORIX launches Korean PE fund to invest in Mirae Asset Life
Japanese financial services group ORIX Corporation is to establish what it claims is the “largest investment fund established by a Japanese company in South Korea” to acquire shares in Korea’s Mirae Asset Life Insurance. The private equity fund - whose total size is KRW300 billion ($277.2 million) - will be jointly established with LTI Investments, and will count nine companies as investors, including the world’s fourth-largest pension fund, Korea’s National Pension Service, and the Korea Teachers Pension.
According to ORIX, the investment into Mirae will be made from the ORIX Private Equity Korea Corporation, its subsidiary in South Korea. The vehicle will purchase more than 21 million shares in Mirae, which will use the capital to finance is business expansion plans and strengthen the "creditworthiness" of the company.
Mirae also announced that it will delay its plan to list on the KOSPI until June of next year in light of the private equity investment.
Mirae is Korea's fifth-largest insurer, established in 1988. According to a statement on the transaction, South Korea's life insurance market has seen annual growth of more than 12% for the past five years. This momentum is slated to continue given the country's market is less mature than those of Taiwan, Singapore and Japan.
Insurance companies have continued to be hot targets for private equity investors in past months. In April, Goldman Sachs acquired a 12.02% stake in China's Taikang Life Insurance from AXA for an estimated $925 million. That news came one month after India's Reliance Capital-owned Reliance Life Insurance also agreed to sell a 26% stake to Japan's largest life insurer, Nippon Life Insurance, for $680 million. And in January, The Carlyle Group sold $860 million worth of shares in China Pacific Insurance, the third-largest insurer in China, for 6x return.
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