KSK group to double stake in Thai unit
Malaysia-based KSK Group plans to double its stake in KSK Insurance (Thailand) from 25 per cent now to 49 per cent by year-end to serve expansion in the future.
It also plans to become the majority shareholder in the Thai subsidiary by increasing its stake to 75 per cent.
Eugene Foong, chief executive officer of KSK Insurance (Thailand) Co, said yesterday that the company had submitted its plan to the Insurance Commission to raise its registered capital from Bt1.1 billion currently. It has not decided yet on the amount.
To serve expansion in Thailand and Indonesia, the company has raised Bt1 billion for technology development and registered capital.
After operating in Thailand for 10 years, the company has reported retained losses of Bt700 million to Bt800 million, which it will write off under its business plan submitted to the watchdog.
“The company’s registered-capital increase will help reduce its retained loss and holding 75 per cent in the company will allow us to have more management rights in our subsidiary here,” Foong said.
Joanne Kua Ying Fei, chief operating officer of KSK Group, said the group’s plan for Thailand was to become one of the top 10 insurers in five years. Its plans are also designed to encourage growth both inside and outside Malaysia through mergers and acquisitions or joint ventures.
The group continues to invest in Thailand as it sees high growth opportunities in the general insurance industry. Last year, the non-life insurance business in Thailand enjoyed growth of 12.1 per cent to Bt140 billion. The industry accounts for 1.7 per cent of gross domestic product.
The investment plan for Thailand has come up partly because of the flood devastation last year. This country has a low ratio?? Of what?? compared to the developed countries in the European Union, where it reaches 2.99 per cent.
The global reinsurer Swiss Re predicts that Thailand’s general insurance business should grow by 5.7 per cent this year and 6.1 per cent next year.
Foong said KSK Insurance (Thailand) would face another loss of Bt34 million, nearly the same as last year. Its total premiums this year are forecast to reach Bt1 billion, of which motor insurance accounts for 85 per cent and non-motor for 15 per cent. The company is still focused on individual customers and groups rather than organisations.
