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Samsung insurers to invest $650m in Blackstone alternatives portfolio

Sept. 28, 2022 - 15:35 By Jung Min-kyung
The ticker and trading information for Blackstone Group is displayed at the post where it is traded on the floor of the New York Stock Exchange (NYSE) April 4, 2016. (Reuters)
Samsung Group’s insurance units signed a deal worth $650 million with US-based private equity firm Blackstone to expand its global alternative asset portfolio, the Korean insurers said Wednesday.

Samsung Life Insurance and non-life insurer Samsung Fire & Marine Insurance will invest in overseas real estate, infrastructure and private equities managed by Blackstone through the latest deal. The investment will be managed by Samsung’s asset management arms Samsung Asset Management and Samsung SRA Asset Management.

This marks the largest global investment since Samsung Group in April decided to team up its five financial units -- Samsung Life Insurance, Samsung Fire & Marine Insurance, Samsung Card, Samsung Securities and Samsung Asset Management -- into an alliance dubbed Samsung Financial Networks.

In recent years, Samsung’s financial arms have been actively expanding their global portfolios. Samsung Asset Management acquired a 20 percent stake in US exchange-traded fund provider Amplify in April this year, following Samsung Life’s decision last year to purchase a 25 percent stake in Savills Investment Management, UK real estate services giant Savills’ property management arm.

From 2019 to 2020, Samsung Fire & Marine Insurance acquired a 19 percent stake in British reinsurer Canopius AG.

The value of assets under management in the global alternatives industry is expected to nearly double over the next five years, S&P Global Market Intelligence reported in January. It is projected to swell to $23.2 trillion by 2026, compared with some $13.3 trillion as of end-2021.

“Blackstone is a forerunner in the global asset management industry and is a great partner for us to expand our global portfolio,” a Samsung Life Insurance official said in a statement.

“We plan to actively expand our global asset management business by strengthening our revenue sources and diversifying our portfolio,” the official added.

Private equity alongside venture capital will see the sharpest growth among the alternative asset classes, the report said, citing a senior official at London-based investment data company Preqin.

Samsung Life Insurance’s net profit in the April-June period jumped 70.3 percent on-year to 199 billion won ($138 million), the company said in a regulatory filing. Operating profit shot up 706.3 percent on-year to 270.4 billion won in the same period.

Meanwhile, Samsung Fire & Marine Insurance’s net profit gained 9 percent on-year to 340.8 billion won in the cited period. Operating income expanded 8.4 percent on-year to 490.1 billion won.