27 October 2009 / AP, AMSTERDAM
European services giant ING Groep NV said Monday it will split itself in two, spinning off its insurance arm to simplify its business and issuing 7.5 billion euros ($11.3 billion) in new shares to repay state bailout money.
The dramatic change in strategy caps a year of cutting costs and selling operations since the financial crisis struck, when ING was kept afloat only with two major rounds of assistance from the Dutch state. The insurance operations have a book value of 22 billion euros, and the company said it will likely seek an initial public offering for them within four years. “This is a momentous day for us: splitting the bank and insurance is not a decision to be taken lightly,” said Chief Executive Jan Hommen, a former board chairman who took the executive job in January after his predecessor was fired. “We’re making a decisive move to turn ourself into a simple organization.”
