New Zealand’s insurance company TOWER has commenced a strategic review of its ownership structure to explore different options for maximising value for all of its shareholders.
This review is being supported by private investment company Bain Capital, a 20% shareholder in Tower.
Goldman Sachs New Zealand is serving as Tower’s financial adviser for the strategic review.
Apart from maximising value for shareholders, Tower also aims to optimise its existing capital structure through the review.
This optimisation is expected to help the company in delivering a strong platform that can address market competitiveness.
It expects this review process to continue for several months.
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The company said it will not take any decisions related to potential transactions or other outcomes throughout this period.
According to Tower, until the review process is complete, the company’s board will not “comment further on the strategic review”.
The company also noted that the latest move will not impact business operations and that work will continue as usual.
Tower chairman Michael Stiassny said: “In our commitment to delivering long-term value to our shareholders, we believe that a thorough examination of our ownership structure is prudent at this time.
“This strategic review will enable us to explore options that align with our objectives and position us for continued success in the marketplace.”
According to a report by Finance News Network, the latest announcement comes shortly after Tower announced its fiscal year 2022–23 annual results, under which the company did not indicate the requirement for any such strategic review.
The insurer’s annual results were mainly affected by the “adverse financial impacts” of floods, storms and heavy rain in New Zealand as well as in parts of Australia and the Pacific, the report added.
Tower is a general insurer that offers a wide range of insurance products, including home, contents and motor vehicle, to its customers across New Zealand and the Pacific.
Recently, Tower partnered with insurtech company CelsiusPro Group to upgrade its IT platform for parametric insurance product.