New Zealand-based insurance company Tower (ASX:TWR)
is set to sell its Papua New Guinea (PNG) subsidiary to Alpha Insurance for $7.9 million.
Alpha Insurance provides a range of personal and business insurance products to the PNG market. The sale is expected to occur in this financial year.
“We remain committed to our Pacific operations in Tonga, Samoa, American Samoa, the Cook Islands, the Solomon Islands, Fiji and Vanuatu," said chief executive officer Blair Turnbull.
“In reviewing our Pacific business we identified that these seven territories offer the best alignment for progressing our digital strategy in terms of existing technology development, digital payments capabilities, and the balanced mix of commercial and personal lines customers."
Following completion of the sale, Alpha Insurance will utilise Tower’s brand as it undertakes a rebranding process for up to three months. Tower will also provide transitional services to Alpha Insurance for up to six months after the completion date.
Shares are trading 1.7 per cent higher at 61 cents.