Malaysian investment holding company MNRB Holdings Berhad announced the signing of a conditional share purchase agreement to acquire the remaining 80% equity interest in Labuan Reinsurance (L) Ltd for approximately US$100.69 million in cash.
Currently, Labuan Reinsurance is an associate company of Malaysia Reinsurance Berhad, a wholly-owned subsidiary of MNRB, holding a 20% stake.
Upon completion of the transaction, Malaysia Re will retain its existing 20% stake in Labuan Re, while MNRB will directly hold the newly acquired 80% stake, making Labuan Re a wholly-owned subsidiary of MNRB.
Labuan Reinsurance Company is an offshore reinsurance company headquartered in Labuan International Business and Financial Center, underwriting general reinsurance and general takaful business in multiple markets.
Through its wholly-owned subsidiary Labuan Reinsurance Company Limited (LRUL), the company also participates in the Lloyd’s market, offering broader and more specialized underwriting opportunities and international risk pools.
Labuan Re’s business is supported by three main revenue streams: underwriting, reinsurance and takaful business, participation in Lloyd’s through LRUL and investment income.
In the latest audited fiscal year ending December 31, 2024, the company achieved after-tax profits of approximately US$26.66 million and net assets of approximately US$197.54 million, reflecting its stable profitability and large asset base.
The acquisition of Labuan Re will strengthen MNRB’s international reinsurance growth, align its global competitiveness and optimize capital deployment in its reinsurance and takaful businesses.
In addition, the transaction is valued at an attractive and tight valuation of approximately 0.88 times Labuan Re’s adjusted tangible net asset value as of December 31, 2024.
Commenting on the proposed acquisition, MNRB Chairman Dato’ Sulaiman Mohd Tahir said: “This acquisition is a meaningful step in MNRB’s development journey and reflects our confidence in the long-term potential of Labuan Re as part of the group. Labuan Re has established a credible position in the international reinsurance market and we believe its full integration into MNRB will create a stronger platform for future growth.”
“As a group, we remain focused on scaling responsibly, strengthening our regional relevance and ensuring our capital is deployed in a manner that supports sustainable value creation. This transaction is consistent with this direction and reinforces our commitment to develop MNRB into a stronger and more resilient reinsurance and takaful group.”