ACE INA International Holdings, Ltd, a subsidiary of ACE limited (ACE) acquired the remaining 49% of ACE Synergy Insurance Berhad in Malaysia from Advance Synergy Capital Berhad. ACE paid a cash consideration of $39 million.
ACE Synergy Insurance provides property and casualty, personal accident and supplemental health insurance lines to commercial and individual customers.
The acquisition of Jerneh Insurance Berhad in Malaysia for $200 million in December 2010 marks ACE Limited’s earlier venture into Malaysia. The recent acquisition further strengthened the company’s presence in Malaysia.
The company continues to benefit from its Asia-Pacific business. Net premiums earned in the Asia-Pacific region in the first quarter were $262 million, surging 22% year over year. The Malaysian unit will further add to the company’s burgeoning business in Asia.
The Travelers Companies Inc. (TRV), which competes with ACE Limited, also announced the completion of its Brazilian acquisition. Travelers acquired the 43% stake in JMalucelli Participações em Seguros e Resseguros S.A., the market leader in the surety insurance business in Brazil.
ACE limited reported a solid first quarter with operating income of 79 cents per share, surpassing the Zacks Consensus Estimate by 13 cents. The better-than-expected performance stemmed from strong renewal persistency, positive client payroll and higher sales.
In its earnings conference call ACE Limited guided its 2011 operating income to a range of $5.40 to $5.70 per share. The Zacks Consensus Estimate for second-quarter 2011 is $1.84 per share. For full years 2011 and 2012, the Zacks Consensus Estimates are, respectively, $6.25 per share and $7.36 per share.
We maintain our Neutral recommendation on ACE Limited. The quantitative Zacks #3 Rank (short-term Hold rating) for the company indicates no clear directional pressure on the shares over the near term.
Headquartered in Zurich, Switzerland, ACE Limited, through its subsidiaries, provides a range of insurance and reinsurance products to commercial and individual customers worldwide.
ACE LIMITED (ACE): Free Stock Analysis Report
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