Goldman buys 12% Taikang stake
Source: Agencies |
April 9, 2011, Saturday
|
Print Edition
Print Edition
GOLDMAN Sachs has bought a 12 percent stake worth more than US$900 million in China's Taikang Life Insurance Co, giving the Wall Street giant a foothold into the world's biggest insurance market.
Goldman's long-overdue purchase could pave the way for Taikang's planned initial public offering next year, analysts said, as the insurer seeks more capital to fund its growth in China.
Credit Suisse estimated China's life insurance market - which generated US$124 billion premium income in 2009 - will grow 20 percent a year for the next decade.
But some analysts doubt if Goldman can earn the same big returns that Carlyle Group and TPG Capital reaped from their investments in Chinese insurance companies.
"Goldman has come in pretty late, so the returns might not be as high as previous investors got," said Sally Yim, senior analyst of financial institutions group at Moody's.
Carlyle invested in China Pacific Insurance (Group) Co and sold down a US$2.6 billion stake over the past few months. Last year, TPG sold a US$2.4 billion stake in China's Ping An Insurance Group Co.
Goldman's long-overdue purchase could pave the way for Taikang's planned initial public offering next year, analysts said, as the insurer seeks more capital to fund its growth in China.
Credit Suisse estimated China's life insurance market - which generated US$124 billion premium income in 2009 - will grow 20 percent a year for the next decade.
But some analysts doubt if Goldman can earn the same big returns that Carlyle Group and TPG Capital reaped from their investments in Chinese insurance companies.
"Goldman has come in pretty late, so the returns might not be as high as previous investors got," said Sally Yim, senior analyst of financial institutions group at Moody's.
Carlyle invested in China Pacific Insurance (Group) Co and sold down a US$2.6 billion stake over the past few months. Last year, TPG sold a US$2.4 billion stake in China's Ping An Insurance Group Co.
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