Tokio Marine sells stake in Arabian insurance

Tokio Marine will sell about 6% of its shares to Alinma Bank.

Tokio Marine & Nichido Fire Insurance (TMNF) announced the sale of its shares (5.75%) in life and non-life insurer, Saudi Arabia-based Arabian Shield Cooperative Insurance Company (AS).

Alinma Bank will be the buyer of Tokio Marine’s shares, which currently holds a 5.75% stake in AS. If materialized, the bank will have about 11.5% shares in AS.

This agreement is still subject to regulatory approval and is predicted to finish by the end of fiscal year 2023, or 31 March this year.

In 2012, TMNF and Alinma Bank established Alinma Tokio Marine Company (ATMC), with TMNF holding a 28.75% ownership stake. 

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This joint venture was aimed at growing life and non-life insurance businesses in Saudi Arabia. In November 2023, ATMC merged with another entity, AS, leading to TMNF's ownership stake being reduced to 5.75%. 

TMNF has now decided to sell its entire stake in AS to Alinma Bank as part of its strategy for capital efficiency improvement and risk diversification. 

Despite this sale, TMNF has arranged a collaborative framework with AS to continue serving its Japanese clients in Saudi Arabia. This transaction is not anticipated to significantly impact the overall business performance of Tokio Marine Holdings.