The Singapore government has blocked Allianz SE’s proposed S$2.2 billion ($1.7 billion) acquisition of a majority stake in Income Insurance Ltd., following public backlash over the deal. Minister of Culture, Community and Youth Edwin Tong announced in parliament that the government concluded it would not be “in the public interest” for the transaction to proceed as currently structured. Concerns were raised about whether Income could continue fulfilling its social mission as a co-operative after the acquisition.
The decision comes as Prime Minister Lawrence Wong prepares for a general election, which must be held by November 2025.
In a Facebook post Wong wrote, “In the course of reviewing NTUC Enterprise’s proposed sale of Income shares to Allianz, we came across additional information that gave us cause for concern. The Government has therefore decided not to approve the transaction. We have tabled an amendment to the Insurance Act in Parliament today to allow MAS to withhold approval of the sale on the grounds of public interest when it involves a current or former cooperative insurer.”
He added, “We have no concerns over Allianz’s standing or suitability to acquire a majority stake in Income. Allianz is a major global insurance company and asset manager that can bring financial strength and expertise to Income. Our concerns are over the structure and terms of this specific transaction, particularly in the context of assurances which Income had given to MCCY when the former was corporatised in 2022. Though this transaction will not proceed, we remain open to a new deal that Income may pursue with Allianz or other partners, so long as our concerns are fully addressed.”
The approval of any revised deal will depend on the country’s financial regulator, which will need to consider the government’s views after amendments to relevant legislation are debated in parliament later this week.
In July, Allianz announced plans to acquire at least 51% of Income from NTUC Enterprise Co-operative Ltd., which would have made Allianz the fourth-largest composite insurer in Asia. The deal sparked criticism, with concerns that it could lead to higher insurance premiums and undermine Income’s original mission to serve middle- and lower-income Singaporean workers.
Both Allianz and Income Insurance have yet to respond to the government’s decision.
Allianz CEO Oliver Baete is approaching the conclusion of a three-year strategic plan focused on steady growth, improved profitability, and capital efficiency, with a preference for share buybacks over large acquisitions. Baete is expected to reveal new targets at a capital markets day in December.
Founded in 1970, Income Insurance operates as one of Singapore’s four systemically important insurers, serving around 1.7 million customers with life, health, and general insurance. While it has faced capital pressures during economic downturns, it has received support from its majority owner, NTUC Enterprise.
Former Income CEO Tan Suee Chieh said the decision to block the deal highlights the importance of public engagement on matters of significant interest.