OCBC Moves to Fully Acquire Great Eastern, Valuing Insurer at SGD 14.27 Billion

Oversea-Chinese Banking Corporation (OCBC.SI), Singapore’s second-largest bank by assets, has initiated a full buyout of Great Eastern Holdings (GELA.SI), a leading regional insurer. The move includes plans to delist Great Eastern from the Singapore Exchange (SGX), signaling a significant restructuring of financial operations within the OCBC Group and a broader shift in the Southeast Asian insurance landscape.

Key Developments: OCBC’s Strategy and Great Eastern’s Future

As of mid-2024, OCBC held a 93.72% stake in Great Eastern, having launched an initial offer in May 2024 to purchase an additional 11.56% of shares at SGD 25.60 per share. Following the acceptance of that offer by a number of shareholders, the public float dropped below the 10% threshold required for continued listing on SGX, leading to the suspension of GELA.SI trading on July 15, 2024.

In a renewed bid, OCBC has now proposed SGD 30.15 per share for the remaining 6.28% stake it does not yet own. This represents a 17.8% premium over the previous offer and values Great Eastern at SGD 14.27 billion (approximately USD 10.9 billion). If successful, OCBC will assume 100% ownership of the insurer, enabling full operational integration within its corporate structure.

This move highlights OCBC’s broader strategic goals: streamlining group operations, strengthening internal capital flows, and maximizing cross-business synergies in a challenging financial services environment.

Quick Facts: What You Need to Know

• GELA.SI trading suspended since July 15, 2024, due to low public float

• OCBC.SI currently owns 93.72% of Great Eastern

• New offer price: SGD 30.15 per share — a 17.8% increase from the previous offer

• Implied full valuation: SGD 14.27 billion

• Deal value for remaining stake: SGD 900 million (approx. USD 699.9 million)

• Delisting rationale: Public float fell below SGX’s 10% minimum requirement

Market Response and Expert Insights

The full acquisition and delisting of Great Eastern reflect OCBC’s intent to consolidate its insurance arm under a single, fully owned structure. Analysts suggest that this integration could reduce regulatory complexity and improve long-term capital management. Delisting may also offer OCBC greater agility in decision-making regarding its insurance operations, free from the demands of public market reporting.

However, while the offer is financially attractive, particularly given the significant premium over the previous offer, there may be lingering concerns among minority shareholders and market watchers about transparency and corporate governance post-delisting.

From a broader perspective, this acquisition aligns with global trends where financial institutions are seeking greater control over their ecosystem by fully absorbing profitable subsidiaries.

Key Takeaways from the Deal

1. Offer increased by 17.8% compared to May 2024 valuation

2. Full ownership stake allows OCBC to fully consolidate Great Eastern

3. Delisting enables strategic flexibility for OCBC’s insurance division

4. Transparency trade-offs expected post-delisting

5. Cross-business synergies likely as banking and insurance operations merge further

Why This Deal Matters for Singapore and Beyond

OCBC’s full buyout of Great Eastern marks a strategic shift in how major banks manage their insurance subsidiaries. With increasing regulatory scrutiny, margin pressure, and the need for capital efficiency, financial groups are opting for internal consolidation. By taking Great Eastern private, OCBC positions itself for a streamlined operational model, improved capital allocation, and enhanced control.

Beyond Singapore, this deal could set a precedent for similar moves in other Asian financial hubs, particularly where universal banking models are evolving rapidly.