AXA Versicherungen May Pay USD580 Million for Rest of China Unit's Shares
Liao Shumin
DATE:  Nov 19 2018
/ SOURCE:  yicai
AXA Versicherungen May Pay USD580 Million for Rest of China Unit's Shares AXA Versicherungen May Pay USD580 Million for Rest of China Unit's Shares

(Yicai Global) Nov. 19 -- AXA Tianping Property & Casualty Insurance is bracing for a major change. AXA Versicherungen, at 50 percent the company's largest shareholder, is now negotiating with other stockholders over an equity buy.

Winterthur, Switzerland-headquartered AXA Versicherungen intends to buy the other 50 percent shares of AXA Tianping and wholly own the latter, the Securities Times reported.

The other five shareholders in Shanghai-based AXA Tianping, which is China's largest foreign-capital property and casualty insurance company, are Shanghai Yike Venture Capital with 14.9 percent, Hainan Huage Industrial Investment at 10.1 percent, Biocause Pharmaceutical holding 9.3 percent, Hainan Luda Science & Technology with 8.3 percent, and Shanghai Rixingkang Bio-Engineering's 7.5 percent. 

All intend to sell their shares to AXA Versicherungen.

The price for the deal has not been finalized. If the transaction price of CNY4 billion (USD580 million) is finalized and approved, it will be the largest equity investment by foreign capital in China's insurance market. It will also be AXA's second large-scale acquisition of Chinese-funded insurance companies, the Securities Times reported.

AXA Versicherungen spent CNY3.9 billion in AXA Tianping's first equity transaction completed in 2014, among which CNY1.9 billion was used to acquire 24.4 percent shares. 

The company increased investment by CNY2 billion in AXA Tianping considering future business development needs, bringing its shareholding ratio up to 50 percent and becoming the company's largest and controlling shareholder.

AXA Tianping has registered capital of CNY846 million (USD122 million). Formed from the merger of Tianping Auto Insurance and AXA's wholly-owned Chinese property insurance unit in 2004,it is headquartered in Shanghai.

AXA Tianping's insurance income was CNY4.5 billion in the first nine months, of which premiums made up 0.5 percent of that of the Chinese property insurance market, ranking first in premium amount as a foreign-invested property insurance company. 

Its insurance income is twofold of that of second-ranked Shanghai-based Cathay Insurance, which is also among the top twenty of Chinese-funded property and casualty insurance companies, data from the country's banking and insurance regulator show.

Editor: Ben Armour

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Keywords:   AXA Versicherungenen,AXA Tianping P&C Insurance Co.