SUNCORP-Metway has offloaded its asset management arm Tyndall Investments to Japanese fund manager Nikko Asset Management for about $128.5 million.
Minter Ellison has advised Suncorp, and Allens Arthur Robinson has advised Nikko, with New Zealand law firm Russell McVeagh. Bell Gully was the New Zealand adviser to Suncorp.
The sell off has been undertaken as part of Suncorp’s strategic focus of simplifying its life business, which includes life insurance, superannuation and investments. The transaction is conditional on Japanese regulatory approval.
Under the arrangement, Suncorp will remain Tyndall’s major client, creating a strategic customer partnership, Minter Ellison said in a statement.
About AUS$18 billion of Suncorp directed funds will continue to be managed by Tyndall Investments.
Suncorp will receive $80 million upfront as part of the sale, on top of a $5 million access fee and a $30 million option fee payable in three years.
The deal was highly complex, said Minter Ellison lead partner on the deal, Christopher Brown, who was assisted by senior associate Tim Rowe. The legal work involved balancing achievement of the client's strategic objectives with the interests of policyholders in the life companies and other stakeholders.
One of the asset teams also operated as a boutique within Tyndall, with a separate ownership and governance structure, so those interests also needed to be dealt with and satisfied in the transaction.
"We helped Suncorp design and deliver a solution in this transaction that left the Suncorp life companies and other stakeholders untroubled by the sale,” said Brown.
“We suspect that the sale will result in other insurers in the region looking carefully at how they can externalise their internal funds management activities to release value and focus on core strategies, while ensuring that the necessary priority is given to the interests of policyholders and others in accordance with legal requirements and good governance."