China’s Oceanwide buys US insurer Genworth
Print Edition
A Chinese conglomerate has agreed to buy New York-listed US insurance firm Genworth Financials for US$2.7 billion, the latest in a Chinese buying spree of foreign assets.
China Oceanwide Holdings, the founder and key shareholder of China Minsheng Bank, offered US$5.43 per share for all outstanding shares of Genworth in an all-cash transaction, according to a joint statement.
There have been many overseas acquisitions this year by Chinese firms seeking better returns and industrial know-how — ranging from Hollywood studio Legendary to leading German robotics firm Kuka and Swiss seed giant Syngenta.
Genworth, founded in 1871, has nearly 4 million life insurance customers and also offers mortgage insurance products, according to its website.
The offer represents a 4.22 percent premium on its Friday closing price.
“Genworth is an established leader in both mortgage insurance and long-term care insurance,” Oceanwide Chairman Lu Zhiqiang said in the statement. “We are providing crucial financial support to Genworth’s efforts to restructure its US life insurance business.”
The Beijing-based firm also promised to offer an additional US$600 million to Genworth to address its debt that will mature in 2018 and a US$525 million cash injection into its life insurance business.
Tom Mclnerney, president and chief executive officer of the Virginia-based insurer, called the Chinese firm “an ideal owner” and said the investment was in the best interests of Genworth’s stockholders.
Upon completion of the deal, Genworth will become a standalone subsidiary of Oceanwide and will retain its current management team.
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