* S.Korea's 5th-largest life insurer to list in 2nd week of
* Paid 58 pct of net profit as dividends in 2016
* ING Life says can continue paying high dividends
By Joyce Lee
SEOUL, April 19 Private equity-owned ING Life
Insurance Korea is banking on its hefty dividend payouts to draw
investors to its planned initial public offering (IPO) that
could raise as much as $1.2 billion in one of South Korea's
bigger public floats.
The nation's fifth-largest life insurer by assets, wholly
owned by Asia-based MBK Partners, will list in the second week
of May, CEO Cheong Mun-kuk said on Wednesday. The IPO would be
South Korea's second-largest float so far this year, behind
Netmarble Games's planned $2.4 billion IPO.
The two IPOs come at a time of heightened geopolitical
tensions in the region over North Korea and amid a corruption
scandal that has led to the ouster of president Park Geun-hye
and fresh presidential elections in May.
But ING Life Insurance Korea said investors asked no
questions about the geopolitical and political risks to the IPO,
choosing instead to focus on its operations.
"They (investors) were very interested in our attractive
dividends," Cheong told reporters, adding hedge funds,
especially, responded positively.
ING Life paid dividends of 182.5 billion won ($160.09
million) in 2016, or about 58 percent of net profit excluding
one-off costs, according to company data.
Cheong said the company has the ability to continue paying
such dividends as it has a good capital-adequacy ratio and
depends on higher-margin captive agents for its growth, instead
of on lower-margin channels such as bank partnerships to sell
ING Life's risk-based capital ratio, a key measure of
insurers' ability to pay policyholders, was 319 percent in
end-2016, compared to South Korea's No. 1 insurer Samsung Life's
302 percent, according to Korea Life Insurance
Association data. ING Life had 5,118 captive agents as of
end-2016, company data showed.
The company said in a filing last month it is selling 33.5
million shares at an indicative price range of 31,500 won to
40,000 won per share, with the IPO seen worth between 1.05-1.34
trillion won. Pricing is expected on April 24, and listing is
expected in the second week of May, Cheong said.
MBK, which acquired ING Life from ING Groep in
2013, will retain about 59.1 percent stake of the company after
the float, giving the whole company a pre-listing valuation of
3.28 trillion won.
Morgan Stanley and Samsung Securities are
advising the IPO.
($1 = 1,140.0000 won)
(Reporting by Joyce Lee; Editing by Muralikumar Anantharaman)