27 July 2024
Following the Pre-Conditional Offer Announcement (“Preconditional Offer Announcement”) from Allianz Europe B.V. (“Offeror”) on 17 July 2024 (“Offer”), the board of directors (“Board”) of Income Insurance Limited (“Income Insurance”) would like to provide additional details on the governance process that the Board has in place in relation to the Offer.
Overwhelming Majority of Independent Directors
The Board comprises 12 directors, of which 10, an overwhelming majority, are independent. All the Independent Directors are experienced and seasoned professionals with considerable experience in their respective fields. The Independent Directors are led by a Lead Independent Director, and their primary responsibility is to ensure that the interests of all stakeholders, including that of policy holders and minority shareholders, are considered. The full Board (including all the Independent Directors) unanimously approved the transaction document entered into by Income Insurance in relation to the Offer.
Steering Committee
At the outset of the transaction, a Board steering committee (“Steering Committee”) was established with the remit to make a recommendation to the full Board. This Steering Committee is chaired by an Independent Director and comprises a majority of Independent Directors. The committee was tasked with ensuring that the interest of policyholders and shareholders were considered, in evaluating the transaction.
In relation to policyholders’ interest, the Pre-Conditional Offer Announcement expressly states that “Allianz intends to ensure a seamless transition for policyholders, continuing to honour the terms of the existing polices underwritten by Income Insurance resulting in no impact on customers”.
In ensuring the interests of minority shareholders are upheld, it was a key requirement of both Income Insurance and NTUC Enterprise that minority shareholders would be accorded priority to tender their shares. As such, NTUC Enterprise will only tender its shares on the last day of the Offer and only to the extent that will result in the Offeror holding at least 51% of the shares of Income Insurance.
Accordingly, minority shareholders will be able to tender all or some of their shares in acceptance of the Offer, or choose not to tender at all, during the period when the Offer is open for acceptance. On the other hand, NTUC Enterprise will not be able to tender all its shares in acceptance of the Offer and has committed to remaining as a substantial shareholder of Income Insurance.
Independent Financial Adviser
As none of the directors of Income Insurance is connected to the Offeror, under the Singapore Code on Take-overs and Mergers, all the directors of Income Insurance are considered independent for the purposes of making a recommendation on the Offer.
Notwithstanding this, and in line with good corporate governance, the Board will establish an independent board committee chaired by the Lead Independent Director and wholly comprising independent directors (“Independent Board Committee”), to select and appoint an independent financial adviser (“IFA”). The advice of the IFA to the Board on whether to recommend shareholders to accept or reject the Offer (when made) will be set out in the Composite Document.
Appointment of Morgan Stanley
Morgan Stanley was appointed as Income Insurance’s financial advisor after a considered selection process.
They were appointed based on their prior insurance transaction credentials, the experience of their deal team and their deep understanding of Income Insurance.
As the Chairman of Income Insurance is a senior executive of Morgan Stanley, he had recused himself from the Board’s decision to appoint Morgan Stanley. The appointment of Morgan Stanley was first reviewed by the audit committee before approval by the full Board.
Commitment to Corporate Governance
Income Insurance remains committed to good corporate governance. This can be seen in our Board composition, which comprises an overwhelming majority of independent directors, the establishment of our Steering Committee when considering the Offer, the formation of the Independent Board Committee to select and appoint the IFA and having our directors recuse themselves where there may be a conflict of interest.
For more details, please visit income.com.sg/pre-convgo.
The directors of Income Insurance (including those who may have delegated detailed supervision of this press release) have taken all reasonable care to ensure that the facts stated and all opinions expressed herein are fair and accurate and that no material facts have been omitted from this press release, the omission of which would make any statement in this press release misleading, and they jointly and severally accept responsibility accordingly.
Where any information has been extracted or reproduced from published or otherwise publicly available sources or obtained from the Offeror, the sole responsibility of the directors of Income Insurance has been to ensure, through reasonable enquiries, that such information is accurately extracted from such sources or, as the case may be, accurately reflected or reproduced herein. The directors of Income Insurance do not accept any responsibility for any information relating to the Offeror or any opinion expressed by the Offeror.
Overwhelming Majority of Independent Directors
The Board comprises 12 directors, of which 10, an overwhelming majority, are independent. All the Independent Directors are experienced and seasoned professionals with considerable experience in their respective fields. The Independent Directors are led by a Lead Independent Director, and their primary responsibility is to ensure that the interests of all stakeholders, including that of policy holders and minority shareholders, are considered. The full Board (including all the Independent Directors) unanimously approved the transaction document entered into by Income Insurance in relation to the Offer.
Steering Committee
At the outset of the transaction, a Board steering committee (“Steering Committee”) was established with the remit to make a recommendation to the full Board. This Steering Committee is chaired by an Independent Director and comprises a majority of Independent Directors. The committee was tasked with ensuring that the interest of policyholders and shareholders were considered, in evaluating the transaction.
In relation to policyholders’ interest, the Pre-Conditional Offer Announcement expressly states that “Allianz intends to ensure a seamless transition for policyholders, continuing to honour the terms of the existing polices underwritten by Income Insurance resulting in no impact on customers”.
In ensuring the interests of minority shareholders are upheld, it was a key requirement of both Income Insurance and NTUC Enterprise that minority shareholders would be accorded priority to tender their shares. As such, NTUC Enterprise will only tender its shares on the last day of the Offer and only to the extent that will result in the Offeror holding at least 51% of the shares of Income Insurance.
Accordingly, minority shareholders will be able to tender all or some of their shares in acceptance of the Offer, or choose not to tender at all, during the period when the Offer is open for acceptance. On the other hand, NTUC Enterprise will not be able to tender all its shares in acceptance of the Offer and has committed to remaining as a substantial shareholder of Income Insurance.
Independent Financial Adviser
As none of the directors of Income Insurance is connected to the Offeror, under the Singapore Code on Take-overs and Mergers, all the directors of Income Insurance are considered independent for the purposes of making a recommendation on the Offer.
Notwithstanding this, and in line with good corporate governance, the Board will establish an independent board committee chaired by the Lead Independent Director and wholly comprising independent directors (“Independent Board Committee”), to select and appoint an independent financial adviser (“IFA”). The advice of the IFA to the Board on whether to recommend shareholders to accept or reject the Offer (when made) will be set out in the Composite Document.
Appointment of Morgan Stanley
Morgan Stanley was appointed as Income Insurance’s financial advisor after a considered selection process.
They were appointed based on their prior insurance transaction credentials, the experience of their deal team and their deep understanding of Income Insurance.
As the Chairman of Income Insurance is a senior executive of Morgan Stanley, he had recused himself from the Board’s decision to appoint Morgan Stanley. The appointment of Morgan Stanley was first reviewed by the audit committee before approval by the full Board.
Commitment to Corporate Governance
Income Insurance remains committed to good corporate governance. This can be seen in our Board composition, which comprises an overwhelming majority of independent directors, the establishment of our Steering Committee when considering the Offer, the formation of the Independent Board Committee to select and appoint the IFA and having our directors recuse themselves where there may be a conflict of interest.
For more details, please visit income.com.sg/pre-convgo.
The directors of Income Insurance (including those who may have delegated detailed supervision of this press release) have taken all reasonable care to ensure that the facts stated and all opinions expressed herein are fair and accurate and that no material facts have been omitted from this press release, the omission of which would make any statement in this press release misleading, and they jointly and severally accept responsibility accordingly.
Where any information has been extracted or reproduced from published or otherwise publicly available sources or obtained from the Offeror, the sole responsibility of the directors of Income Insurance has been to ensure, through reasonable enquiries, that such information is accurately extracted from such sources or, as the case may be, accurately reflected or reproduced herein. The directors of Income Insurance do not accept any responsibility for any information relating to the Offeror or any opinion expressed by the Offeror.
