Charoen Pokphand insists it has funds to buy HSBC stake in Ping An
Thai conglomerate denies that its purchase of HSBC's stake in mainland insurer has soured, and regulators are still considering the matter
Thailand's Charoen Pokphand Group yesterday issued a statement reaffirming that it had the means to acquire HSBC's US$9.4 billion stake in Ping An Insurance, in a bid to scotch reports that the deal was unravelling.
"The transaction is still under consideration by the China Insurance Regulatory Commission (CIRC) and we confirm that if approval is received from the CIRC, the CP Group has the necessary resources to complete the transaction," said the statement e-mailed to the South China Morning Post yesterday.
Doubts have been cast on the ability of the unlisted agricultural conglomerate controlled by Thai tycoon Dhanin Chearavanont to pull off the deal.
The Post has reported that state-controlled China Development Bank (CDB) is reconsidering its decision to act as the guarantor for CP amid concerns over the identity of the real buyer.
CP Group said it was acting entirely on its own and "not in concert with, or on behalf of, any third party", after media reports that investors were funding the transaction.
The market reacted with surprise when it emerged last month that HSBC's Ping An stake was in fact worth more than CP Group's net assets, triggering speculation that CP was backed by other, invisible investors.
According to CIRC rules, companies can buy a stake in a Chinese insurer only with their own money, not through bank loans or other third-party financing.