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A British activist investor has appealed to Singapore’s markets regulator to intervene in the takeover of an insurer by the city-state’s second-biggest bank, calling the deal “gravely unfair” for shareholders.
The move by Palliser Capital, which has taken on several high-profile companies since its founders broke away from Elliott four years ago, is the latest in a wave of activist campaigns in Asia in the past year.
There were 57 campaigns against Asian companies in 2024, up from a previous record of 44 the year before, according to Lazard, with Japanese groups Sumitomo Corporation, SoftBank and Nissan all being targeted in the past six months.
Great Eastern is Singapore’s oldest and largest life insurer. Palliser, which has a stake in Great Eastern, has accused OCBC of treating minority shareholders unfairly in its attempted full takeover of the company.
In letters sent to the Monetary Authority of Singapore and SGX stock exchange, seen by the Financial Times, the activist accused the Great Eastern board of being “highly complacent” in recommending the offer.
It added that the insurer’s “corporate governance safeguards designed to protect the interests of minority shareholders were lacking or insufficiently robust”.
In response, the MAS and SGX told Palliser they were monitoring the case and engaging with both sides, according to communications seen by the FT.
Great Eastern, which has more than S$100bn (US$73bn) in assets and 16mn policyholders in Singapore and Malaysia, has been part-owned by OCBC since 1958. A minority of shares, about 6 per cent, are listed on Singapore’s stock exchange.
In 2008, OCBC increased its stake in the insurer to 87 per cent and announced a voluntary offer in May last year to take full control of the business for S$1.4bn, or S$25.60 a share, a 37 per cent premium on the share price at the time.
EY provided a valuation to the insurer, which put it at a range of S$28.87 to S$36.19 a share, though Palliser believes it should be higher.
The activist argued that senior Great Eastern executives and board members — several of whom are former OCBC executives — had conflicts of interest because they received a large proportion of their pay in the bank’s stock and therefore benefited from a lower offer price.
Palliser complained to the MAS about the Great Eastern board’s refusal to meet the activist investor over the issue.
“Great Eastern’s seeming unwillingness to engage with us in any meaningful sense has added to our sense of unease and frustration and made us determined to ensure that the interests of Great Eastern’s remaining minority shareholders are safeguarded,” the investor wrote.
Foreign activist forays are relatively rare in Singapore, which prides itself on being a business-friendly financial hub. But several recent cases have led to Swiss and Australian activists pushing for better deals for minority shareholders in takeover deals.
Many of the campaigns against Asian companies are focused on breaking up multi-industry conglomerates, with Asia-Pacific catching up with Europe as the second most active region behind the US.
Among Palliser’s recent campaigns are a move to force Rio Tinto to abandon its primary London listing and consolidate its Australian business, as well as pushing for change at a Japanese property company and a rail operator with a stake in Tokyo Disneyland’s owner.
Palliser, OCBC, the MAS and SGX declined to comment on the Great Eastern campaign. Great Eastern did not respond to a request for comment.
This article has been amended since publication to correct the percentage of listed shares in Great Eastern and to clarify that EY provided the valuation to the insurer, not Palliser Capital
https://www.ft.com/content/83234e63-336a-4815-9194-984cec2615dd
