Asset injection from parent comes just before the mainland insurance giant's dual listing in Hong Kong and New York
China Life Insurance has inherited net assets worth 29.6 billion yuan (HK$27.8 billion) before a planned US$2.5 billion dual listing of 25 per cent of its shares in Hong Kong and New York, according to a filing to the US Securities and Exchange Commission.
The listing, which values China Life at about US$10 billion, will be the world's biggest initial public offering this year. China Life is attempting to raise almost four times the amount PICC Property and Casualty garnered from its listing in Hong Kong last month.
The asset injection from China Life's parent, China Life Insurance Group, comprises a wholesale transfer of cash, bank deposits, securities and buildings. Inherited liabilities include 44 million individual and group life insurance policies, annuity contracts and long-term health insurance policies.
The parent injected its better quality assets into China Life, while the policies transferred were written after 1999. Life policies issued in China before 1999 carried high guaranteed returns to policy-holders. Including them in the listing vehicle would make it a harder sell to potential investors.
In return, the parent will be given 20 billion shares, or a 74.7 per cent stake in China Life, the mainland's biggest life insurer.
