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ASB Losing Battle to Keep Stake in Insurance Company

Advanced Synergy Berhad (ASB) appears to be giving up hope to keep its 49% equity stake in Ace Synergy Insurance Berhad (ASIB).  ASB has finally called an EGM on 6th June 2011 to seek shareholders’ approvals to approve the disposal of its 49% stake in ASIB for RM117 million.  ASB has been fighting against ACE INA International Holdings Ltd (AIIH) in courts against the latter exercising a call option to purchase ASB stake in ASIB on 4th Feb 2009.  ASB had disputed the validity of the call option arising from an Amended and Restated Shareholders Agreement between ASB and AIIH in January 2009. Although the sale may be against ASB’s wish, the proceeds from the disposal of RM117 million is about the same value as the whole market capitalization of ASB before accounting for conversion of ASB’s warrant-like ICULS (ASB-LA).

 

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