GSIS eyes 49% of Philamlife

MANILA, Philippines – State pension fund Government Service Insurance System (GSIS) is interested in acquiring as much as 49 percent stake in Philamlife, which is being offered for sale by its troubled US-based parent company American International Group or AIG.

“We are looking to be a strategic investor. We can acquire anywhere between one percent and 49 percent but we have to look at their books,” GSIS president and general manager Winston Garcia told reporters yesterday.

The GSIS chief said acquiring AIG’s Philippine assets would complement the pension fund’s insurance business.

AIG has yet to issue an update on its bid to sell its Philippine subsidiary.

Garcia said that GSIS has already inquired on the “numbers” or the price of the Philippine assets of AIG, considered until recently a crown jewel in the global insurance industry.

AIG had earlier announced its plan to dispose of some assets including Philamlife to pay $85 billion debt to the US government.

Garcia noted that Philamlife remains a formidable player in the life insurance market and that acquiring it would strengthen GSIS.

The GSIS chief also said that in these uncertain times, it may be viable to consider other acquisitions.

“The best time to buy is when there is blood on the streets,” Garcia earlier said, referring to the financial meltdown in the US brought about by the credit crunch in its home mortgage market.

“We’re looking at all opportunities,” he said.

Earlier, Philamlife said that nearly 10 local and foreign groups including the Yuchengco family have expressed interest in acquiring the company.

The Ayala Group, the country’s biggest conglomerate, has also signified interest in Philamlife.

Philamlife is the country’s largest insurance company, offering healthcare insurance, pre-need plans, asset management and other services.

AIG’s financial debacle, as well as that of Lehman Brothers and Merrill Lynch, has sent shockwaves across the globe leaving giant markets in disarray and raising the specter of a global recession.

Philippine officials initially downplayed the crisis saying local financial institutions had little or no investment in the troubled US institutions.

But as the crisis unraveled, officials took steps to address its possible impact on the country’s exports and on remittances from Filipino workers overseas.