Hyundai buys life insurer for 228B won

Hyundai Motor Group, Korea’s second-largest family-owned conglomerate, bought a local life insurer as it moves to expand its financial sector portfolio, business sources said yesterday.

Financial sources said that Hyundai secured Green Cross Life Insurance for 228.3 billion won ($198.3 million) from Green Cross Holdings. The holding company owned a stake of around 90 percent in the insurer ranked 18th by market share.

Green Cross Life Insurance was created after Green Cross Holdings took over the struggling Daishin Life Insurance in 2003. But the life insurance company failed to grow into a major player.

Hyundai Mobis bought a 37.4 percent stake for 95.6 billion won while Kia Motors and Hyundai Commercial bought 28.1 percent each at 71.7 billion won, respectively.

With the sale of its shareholdings in the life insurance firm, Green Cross Holdings plans to focus on pharmaceutical drugs.

The takeover by the world’s fifth-largest carmaker, with more than 60 affiliates, will increase the business areas covered by the conglomerate in the financial sector.

At present, it holds Hyundai Card, Hyundai Capital, HMC Investment Securities and Hyundai Commercial. The group only lacks a bank, which it cannot own due to state regulations.

Insiders said that Hyundai began engaging in talks to buy the life insurer early this year.

The purchase is likely to have an impact on Korea’s life insurance market, currently controlled by Samsung Life Insurance, Kyobo Life Insurance and Korea Life Insurance.

Yonhap