SINGAPORE: Mr , Ronald Ong, the president of Income Insurance, had recused himself from the board’s decision to nominate Morgan Stanley as the financial adviser in its deal with Allianz, said Income Insurance.
As a result of questions the day before about a potential conflict of interest arising from Mr. Ong’s positions in both Income and Morgan Stanley, the Singapore insurer issued a statement in the early hours of Saturday ( Jul 27 ).
Mr Ong, in addition to being president of Income, is likewise the , chairman and CEO of Morgan Stanley’s Southeast Asia company. He has been a Morgan Stanley employee for over 20 years.  ,
” Morgan Stanley was appointed as Income Insurance’s economic assistant after a considered choice process”, said Income on Saturday, in response to CNA’s questions.
According to them, they were chosen based on their previous experience with comprehensive transactions, the deal team’s experience, and their thorough knowledge of income insurance.
Income further stated that a review committee had reviewed Morgan Stanley’s visit before the table had given its approval.
Additionally, the employer claimed that none of its executives are connected to Allianz and are therefore” considered separate for the purposes of making a proposal on the offer.”  ,
The committee will establish an independent panel committee chaired by the lead separate director and wholly composed of separate directors, to choose and assign an independent financial director, according to Income Insurance, and in accordance with good corporate governance.
The independent financial adviser’s recommendation to the board regarding whether to recommend to shareholders to accept or reject the offer ( when made ) will be included in the composite document.
Disagreement OVER DEAL
The package, which will make Allianz the largest investor in Income Insurance, has previously faced backlash as the people feared it would sacrifice Income’s stated devotion to Singapore’s employees.  ,
Allianz announced on Jul 17 that it had intended to purchase 51 per cent of Income Insurance’s shares, stating an offer of S$ 40.58 ( US$ 30.20 ) per share for a transaction value of S$ 2.2 billion.
NTUC Enterprise now has a 72.8 per cent interest in Income Insurance. If the purchase is successful, it will continue to be a significant investor.
Several spectators expressed concern about how this may conflict with the company’s initial purpose following the announcement, including former CEO of NTUC Income Co-operative Mr. Tan Suee Chieh.  ,
The company was founded in 1970 with the aim of providing necessary, affordable insurance to underprivileged employees.  ,
Given that the guarantee from NTUC Enterprise to be as a majority shareholder was used to lessen worries about its corporatization in 2022, Mr. Tan described the transaction as a “breach of great faith.”  ,
After the deal with Allianz, NTUC Enterprise president Lim Boon Heng announced on Thursday that the cooperative will continue to offer affordable insurance to consumers with lower incomes.  ,
Experts told CNA that some of the concerns over the package are justified because Allianz’s objectives may not be in line with Income Insurance’s classic objectives.
They added that the agreement makes sense from a business standpoint because a larger scale of operations might lead to savings like lower fees.