Canada's Fairfax to buy 80 pct of Indonesia's AMAG for $165 mln -source

Tue Jun 28, 2016 1:53am EDT
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* Fairfax to buy stake from Indonesia's Panin Group

* Says deal likely to close by year-end

* AMAG to enter long-term partnership with Panin Bank

By Eveline Danubrata and Saeed Azhar

JAKARTA/SINGAPORE, June 28 (Reuters) - Canada's Fairfax Financial Holdings Ltd has agreed to buy 80 percent of PT Asuransi Multi Artha Guna Tbk (AMAG) for about $165 million, a person familiar with the matter told Reuters, sending shares of the Indonesian insurer to a record high.

Fairfax, in a statement late on Monday, said it would buy the stake from PT Paninvest Tbk and affiliates in a deal likely to close by year-end.

On Tuesday, AMAG shares rose as much as 15.5 percent to 462 rupiah ($0.035), compared with just 0.7 percent in the broader market.

Fairfax's deal with the Panin Group, controlled by Indonesia's Gunawan family, highlights foreign interest in the Southeast Asian country's general insurance market after a number of deals in recent years in the life insurance segment.

Japan's Sumitomo Life Insurance Co bought 40 percent of the life insurance arm of PT Bank Negara Indonesia Tbk, while compatriot Dai-ichi Life Insurance Co Ltd acquired 40 percent of Panin Life.   Continued...