EXPLAINER: When Naomi Ballantyne signed the $1 billion deal to sell Partners Life to Japanese company Dai-ichi Life on Friday, she felt a surge of relief.
Turmoil in global markets could have thrown a spanner in the works, and since Dai-ichi Life’s first offer in April, she had been in terror of the deal being derailed.
“That’s the terror. All the way through the process, the world is still turning while you are trying to do your due diligence, and get all the parties on board,” she says.
“My biggest worry was please, please, don’t let anything derail this,” she says.
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She’d seen that happen to a friend Chris Coon, who was ready to sell reverse mortgage company Sentinel, when the global financial crisis struck, and the deal fell through.
There was a personal element to this terror, too. Inking the deal finally laid to rest another of Ballantyne’s greatest worries, one that harks back to a penniless childhood.
“We don’t have to worry about our son paying for our retirement, which is funnily enough one of the biggest worries I ever had,” she says, of herself and husband Kerry.
“That’s coming from a very poor background, and having dependent parents for a period of time, and not wanting to do that to him,” she says.
Supplied
Partners Life founder and managing director Naomi Ballantyne.
Her father worked for the Post Office, but had a bad back injury when young. The result was there wasn’t much money, and her seamstress mother had to work hard, as the couple raised five children.
“There wasn’t any money to splash around. We certainly weren’t starving, but that was it,” she says.
“The barefoot kid from Glenfield done good,” she says.
US private equity company Blackstone owned just over half the company, and there are several hundred other shareholders, including New Zealand private equity funds.
“I’ve done very well, but I’m not a billionaire, by a long shot,” she says.
She doesn’t expect to turn up in the annual NBR Rich List.
“I don’t think so. That’s for a different league, not me,” she says.
The billion-dollar deal has made some millionaires of minority shareholders, but shareholders owned just a few thousand shares.
“A lot of people have done really well, and I’m very happy to have done that,” Ballantyne says.
Lawrence Smith/STUFF
A few years ago, it had looked like Ballantyne would take Partners Life public by listing it on the NZX New Zealand stock exchange.
There are still some hurdles for the deal to pass, as it’s subject to Overseas Investment Office (OIO), and Reserve Bank Te Pūtea Matua, approval, which will delay completion for several months.
About 225,000 people have policies with Partners Life.
Most of them have life insurance policies bought through insurance advisers.
Those advisers will be contacting people to answer their questions on the deal, but the terms of their cover are not changing.
“There’s no change for policyholders, it’s just a change for shareholders,” she says.
Insurance policies are contracts that are unaffected by the sale, and Ballantyne stresses the deal is a sale, not a merger.
Dai-ichi Life has no other business in New Zealand, and will continue to operate the business with Ballantyne as its managing director out of its offices in Takapuna, a growing financial services hub in Auckland out of which Fisher Funds and Juno also operate.
“As long as our advisers feel they offer the best value to those customers, they are not going to move those clients,” Ballantyne says.
Almost the entire life insurance sector has changed hands in the past five years with $10.4b of deals done, covering 1.5m policies held by New Zealanders.
The Partners Life sale is seventh major life insurance deal.
Stacy Squires/Stuff
The life insurance operations of ASB, Westpac, BNZ and ANZ have all been sold in the past five years.
In February, Westpac sold its life insurance business, which had 150,000 policyholders, to Fidelity Life for $400m.
Kiwibank sold its life insurance business, which had 34,000 policyholders, to Australian insurer NIB in November for $45m.
BNZ’s life insurance business, which had 102,000 policyholders, was sold to Partners Life in 2020 for $390m.
In 2018, ANZ sold its life insurance business Onepath, which had 186,000 policyholders, to Cigna for $700m. Onepath Life was originally set up by Ballantyne under the name Club Life.
Also in 2018, AMP sold its life insurance businesses in Australia and New Zealand for $3.73b. There were more than 200,000 New Zealand policyholders.
The year before, ASB’s sister company Sovereign was sold to AIA for $4.15b. It had 646,000 policyholders.
Inside the $1billion Partner’s Life sale: ‘The barefoot kid from Glenfield done good’ & Latest News Update
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