Furthering Reach
According to the IB industry on Oct. 5, Samsung Life, the biggest insurer in Korea, is reportedly preparing to take over a mid-sized or bigger asset management company headquartered in Europe.
It was confirmed that Samsung Life assembled a task force team and had it complete DD work with accountants after selecting multiple candidates to acquire. Before, Samsung Life considered taking over an insurer in Southeast Asian nations such as Vietnam and Indonesia. But this is the first time for the company to study the feasibility of acquiring an insurer in developed countries.
“The top management of the group, including Vice Chairman Lee Jae-yong, judged that the group should develop asset management capabilities in order to expand its financial business,” said a U.K.-based representative of the IB industry. “Even though Samsung Life Insurance took over Samsung Asset Management as a subsidiary, there is a long way for the company to go. This compels Samsung Asset Management Co. to focus on developing domestic products such as ETFs. Overseas, Samsung Life will take over a European asset management company with excellent product development capabilities and give the work to it.”
In fact, the Samsung Group has begun to reinforce its asset management business with the vertical integration of its financial affiliates with Samsung Life in the center. The Samsung Group transferred equities in financial affiliates such as Samsung Fie, Samsung Card, Samsung Securities, and Samsung Asset Management to Samsung Life.
In particular, Samsung Asset Management was incorporated into Samsung Life. This incorporation is linked to the expansion of Samsung Life’s growth potential. “The current system, where Samsung Asset Management manages stocks and bonds at home and abroad instead of Samsung Life, can hardly enable the company to catch up with global asset management companies in a short period,” an IB industry expert said. “By taking over a European asset management company, Samsung Life will be able to catch two birds with one stone – introducing products popular among global investors in the European region and exporting domestic products abroad. This can save Samsung Life much time and money.”
With the goal of strengthening asset management, Samsung Life is transferring its London corporation to Samsung Asset Management. In fact, this corporation acquired an asset management business license from the Financial Conduct Authority (FCA) in the U.K. This allowed Samsung Life to take over a European asset management company through its subsidiary, Samsung Asset Management London (tentative name).