(Bloomberg) — Mercuries Life Insurance Co. is considering options including a sale of the business, according to people familiar with the matter, in what could mark further consolidation in Taiwan’s financial services industry.
The firm is working with advisers to gauge initial interest from prospective buyers, the people said, asking not to be identified because the process is private. A sale could attract local and international players, the people said.
Taipei-listed Mercuries Life rose as much as 3.6% Wednesday morning, the biggest gain this month and trimming its year-to-date loss to around 15%. Taiwan’s benchmark index was down 1.8% as of 9:30 a.m. Wednesday.
Another option could be selling a stake rather than the whole business, the people said, adding that considerations are preliminary and may not lead to a transaction. The company has a market value of $1 billion.
Mercuries Life has been in the crosshairs of Taiwan’s Financial Supervisory Commission, which says the firm violated rules after failing to implement a plan to improve its capital-adequacy ratio. It’s been told to complete the process by year-end and provide more details before the end of August.
In response to queries from Bloomberg News, Mercuries Life said it aims to enhance capital and seek potential partnerships at home or abroad, and takes all options into consideration.
While the company is open to proposals from overseas, Chinese bidders are less likely as they’d need approval from multiple government agencies, which could block deals in sensitive sectors such as the financial industry on national security grounds.
Taiwan has been trying to lift the financial industry to make the economy less reliant on the technology sector. For life insurers, the weaker US dollar has hurt as it’s dragged down the value of their foreign-currency assets, particularly in the first half of the year, when Taiwan’s life insurance industry posted a NT$522 billion ($17.3 billion) foreign-exchange loss.
Other Taiwanese transactions include a merger between Taishin Financial Holding Co. and Shin Kong Financial Holding Co., completed last month, while Fubon Financial Holding Co. acquired Jih Sun Financial Holdings Co. in 2022.
Founded in 1993 and listed in 2012, Mercuries Life provides products including life, health, accident and other types of insurance, according to its website.
–With assistance from Chien-Hua Wan and Argin Chang.
(Updates with share price reaction in third paragraph.)
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