Red chip China Insurance International Holdings (CIIH) plans to tap the mainland fund management market by acquiring an asset management firm from its parent, China Insurance HK.
The company yesterday said it would pay HK$403.2 million for a 100 per cent interest in China Insurance Group Assets Management.
CIIH chief executive Miao Jianmin said the Hong Kong-registered asset management firm was set up in May last year to manage private equity funds. The company, accredited by the Securities and Futures Commission, has about HK$2.3 billion in assets under management and mainly invests in bonds. Unaudited data showed its five funds had an average return of 6.4 per cent in the past year.
The acquisition follows CIIH's purchases last year of stakes in Tai Ping Life Insurance, property insurer Tai Ping Insurance and Huatai Insurance Agency & Consultant Service.
CIIH deputy chief executive Dong Ming said: 'It marks another big step ahead in our endeavour to become a comprehensive financial services provider.'
The insurer will pay HK$201.6 million in cash and issue 51.63 million new shares at HK$3.90 each, raising China Insurance HK's stake in CIIH from 52.9 per cent to 54.8 per cent.
The acquisition is expected to be completed by September, pending shareholder and regulatory approval.
