Australian financial services major ANZ will buyout its wealth management and life insurance joint ventures with Dutch entity ING Group for euro 1.1 billion.
As part of the agreement reached between the companies, ANZ would acquire ING's 51 per cent shareholding in the ANZ-ING wealth management and life insurance joint ventures in Australia and New Zealand.
The transaction is expected to result in a profit of euro 300 million for ING.
"ING will sell its 51 per cent equity stakes in ING Australia and ING New Zealand to ANZ, who now will become the sole owner of these businesses. ING will receive euro 1.1 billion in cash from ANZ," the Dutch firm said in a statement today.
Currently, ANZ holds 49 per cent each in both the joint ventures.
The deal, subject to regulatory approvals, is anticipated to close in the fourth quarter of 2009.
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ING and ANZ merged their insurance and wealth management operations in Australia and New Zealand in 2002.
The JVs now employ 2,200 staff in Australia and 500 in New Zealand.
"This transaction is another important step in executing our Back to Basics strategy.
"The sale of our insurance and wealth management operations in Australia and New Zealand is further proof of our determination to simplify the organisation by focusing on fewer, strong franchises that form a coherent group," ING Group CEO Jan Hommen said.
In a separate statement, ANZ said that related to the transaction, the company would buy ING's interests in the ING (NZ) Diversified Yield Fund and Regular Income Fund in New Zealand for AUD 55 million.
As part of the deal, ANZ would continue to use ING brand for a period of up to 12 months while future branding is determined.
"ANZ will continue to use ING Investment Management as its preferred provider of asset management services in the medium term," the statement noted.
In New Zealand, the acquisition includes the ING New Zealand investment management business and two property trusts.
"Similar to the recent RBS Asia acquisition, ANZ has been able to take advantage of the global financial crisis and ANZ's strong balance sheet to advance our strategy," ANZ CEO Mike Smith said.