Mar 02, 2015 05:51 PM

Attempt to Gain New Investor Failed, New China Life Insurance Says

(Beijing) – New China Life Insurance Co. Ltd. (NCI) said on March 1 its plan to bring in a new strategic investor failed due to disagreements on major issues.

The Shanghai- and Hong Kong-listed firm resumed trading of its shares on March 2. It suspended them on January 19, saying that it was looking for a strategic investor with a "leading status in the Internet industry."

Ant Financial Services Group, which is related to Alibaba Group Holding Ltd. and also controlled by Jack Ma, showed interest in the insurer's shares, Shanghai Securities News reported. It cited people close to NCI's talks with Ant Financial.

A source close to NCI said the firm had wanted to issue additional shares to the new investor, but changed its plan after its biggest shareholder, Central Huijin Investment Ltd., said it wanted to cash out some of its holdings in the company.

NCI's board of directors agreed to the proposal because the company did not have a great need to replenish its capital, the source said.

Central Huijin bought 38.815 percent of NCI for about 8 yuan per share in 2009 and now owns 31.34 percent of the insurer. NCI's A-shares closed at 51.27 yuan on March 2, down 2.6 percent the day trading was suspended.

Central Huijin is owned by the country's sovereign wealth fund, China Investment Corp., and it invests primarily in state-owned financial institutions.

NCI said its shareholders still think Internet finance is the direction of future business and it will continue to develop insurance products using Net technologies.

NCI collected 109.9 billion yuan in life insurance premiums last year, ranking the third in the country for the fifth straight year, data from the regulator show. China Life Insurance Co. was first, and China Ping An Insurance (Group) Co. second.

(Rewritten by Wang Yuqian)

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