Jun
29
Chinatrust Walks Away from Nan Shan Deal with AIG
By Sergio | Published June 29, 2010
Chinatrust Financial Holding Co. Ltd. of Taiwan has effectively walked away from a deal with a Hong Kong-based consortium, formed by China Strategic Holdings Ltd. and Primus Financial Holdings, to purchase a 30 percent stake in Nan Shan Life Insurance Co. Ltd. a unit of American International Group Inc. (AIG), by letting the deadline of the deal lapse.
The deadline stipulated in the memorandum of understanding signed between Chinatrust and China Strategic expired last week.
Chinatrust has made the decision in spite of a pending decision by the Taiwanese regulators, the extension of the deadline to 12 October reached between China Strategic and AIG, and having previously agreed to set-up a escrow fund in trying to increase the approval likelihood of the deal.
Taiwan-based Chinatrust is a financial holding company with businesses in banking, securities, credit cards, insurance brokerage and asset management, and had previously lost a bid to acquire Nan Shan.
In an agreement made back in November 2009, China Strategic would sell to Chinatrust a 30 percent stake in Nan Shan for US$660 million (EUR 538 million). As part of this agreement, Chinatrust would allow China Strategic obtain 9.95 percent stake in the company through a subscription of 1.17 billion shares of their common stock at US$0.55 (EUR 0.45) a share.
The Taiwan Ministry of Economic Affairs has not approved the deal yet and has declined to comment on the progress of the regulatory review.
Insurance Companies mentioned:
The American International Group is a leading international insurance organization with operations in more than 130 countries and jurisdictions globally.
Nan Shan Life Insurance Company, Ltd. was established in July 1963. After its restructuring in January 1970, Mr. K.K. Tse, the then Chairman of American International Underwriters, became the first Chairman of the company. In forty years, Nan Shan has become a super insurance company with the most professional management, the best operational performance, and a solid financial foundation. Its agency force has been recognized as the best in Taiwan’s life insurance industry.
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[...] Chinatrust Financial Co. Ltd, Taiwan’s third-largest financial services provider by assets, has agreed to purchase US-based MetLife Inc’s Taiwanese life insurance unit for US$180 million. With the acquisition of MetLife Taiwan, ChinaTrust will finally be able to enter the life insurance market it has long coveted. [...]