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ACE buys JaPro for $130M

by Thomas Zadvydas | Published June 13, 2012 at 3:40 PM

Swiss property and casualty insurer ACE Ltd. announced Wednesday, June 13, that it has acquired Indonesian general insurer PT Asuransi Jaya Proteksi for about $130 million.

The Jakarta, Indonesia-based target, also known as JaPro, was founded in 1963 and offers property, motor, accident and health insurance, as well as commercial insurance coverage for marine cargo and liability. The deal should close in the third quarter and is contingent on regulatory review and other closing conditions.

"The acquisition of Asuransi Jaya Proteksi will allow ACE to diversify its business in Indonesia with a well-developed personal lines franchise that is recognized for its strong customer service culture," said ACE vice chairman and CFO John Keogh in a release.

Zurich-based ACE has made other bolt-ons in other international locales. Wednesday's deal is the latest in a host of acquisitions by ACE as it tries to expand its presence around the world.

"[JaPro] is a small deal, but it's perfectly aligned with what they've been doing in other countries," said an analyst who declined to be named. "This is one of the ways that they like to go into an Asian market, find a niche company."

In December 2011, ACE acquired Rio Guayas Cia. de Seguros y Reaseguros, an affiliate of Ecuadoran financial services firm Banco de Guayaquil SA, for $55 million. ACE in September of that year also bought Wilkes-Barre, Pa., agriculture insurance holding company Penn Millers Holding Corp. for $107 million in cash.

ACE last June acquired its Malaysian joint venture from investment holding company Advance Synergy Capital Bhd. for $39 million in cash. It made a sizable acquisition for the Hong Kong and South Korean life insurance operations of New York Life Insurance Co. for $425 million in October 2010, building on holdings it already had in those markets.

"Over time they'll probably patch together Indonesia, Malaysia, Korea in a framework so that they can handle international customers anywhere," said the analyst.

ACE didn't return calls. JaPro couldn't be reached.

ACE is one of the world's biggest providers of property and casualty insurance, operating in 53 countries, with 16,000 staff and nearly $21 billion of gross written premiums last year.

Its shares were down 20 cents, or 0.28%, to $71.89 on Wednesday afternoon, giving it a market value of about $24.3 billion.

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ACE buys JaPro for $130M

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