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Tower sells Papua New Guinea subsidiary

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New Zealand’s Tower is selling its stake in its Papua New Guinea subsidiary to Alpha Insurance this year for $7.9 million.

Tower has operated in Papua New Guinea since 1980. The sale comes after the insurer acquired National Pacific Insurance in December, which operates across Tonga, American Samoa and Samoa.

CEO Blair Turnbull says Tower remains committed to its Pacific operations there, as well as the Cook Islands, the Solomon Islands, Fiji and Vanuatu.

“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,” Mr Turnbull said.

The sale will allow Tower to accelerate streamlining and modernisation of its Pacific business operation, he said.

In the year to September, the PNG business had gross written premiums of $NZ8.7 million ($7.85 million) and net profit after tax of $NZ900,000 ($812,232). Net assets are $NZ4.7 million ($4.24 million).

“Our Papua New Guinea subsidiary has performed well and delivered solid results. We expect the company to continue to thrive under Alpha Insurance’s ownership,” Mr Turnbull said.

Alpha MD Bruce Avenell said Tower’s PNG employees will be “warmly welcomed”.