Swiss insurer Chubb to increase stake in Huatai Insurance in $1.5bn deal
Swiss insurance company Chubb has agreed to purchase an additional stake of 15.3% of China-based Huatai Insurance Group, as per the latest insurance acquisition news.
Huatai Insurance Group is the holding company of Huatai P&C Insurance Company, Huatai Life Insurance Company, and Huatai Asset Management Company, and other subsidiaries.
Following the completion of the share purchases, Chubb is expected to increase its stake in the Chinese insurance group to 46.2%.
Reuters reported the deal value to be 10.8 billion yuan ($1.53 billion).
Last week, Chubb secured approval from the China Banking and Insurance Regulatory Commission (CBIRC) for other unrelated share purchases agreed by it previously to take its stake to 30.9%.
Huatai Group’s insurance operations are said to have 600 plus branches and 11 million customers.
Chubb will buy the shares from the Inner Mongolia Junzheng Energy and Chemical Group and one of its fully-owned subsidiaries. The parties involved in the deal have also agreed to the planned terms of a subsequent acquisition of an additional 7.1% stake of the company depending upon the closing of the first purchase.
The transactions would need receipt of regulatory approvals and satisfy other main conditions.
Evan G. Greenberg – Chubb Chairman and CEO said: “Earlier this year, following approval from the CBIRC, we increased our ownership in Huatai Insurance Group, which became the first domestic Chinese financial services holding company to convert to a Sino-foreign equity joint venture. The agreement we are announcing today is another important milestone toward our goal of majority and beyond ownership in Huatai.
“We are committed to supporting Huatai as a long-term strategic shareholder and we have great confidence in the long-term potential of the Chinese insurance market. We are builders at Chubb, and our increasing stake in Huatai is an opportunity to build a great Chinese insurance company that will meet the growing protection needs of Chinese consumers and businesses.”