Anbang Insurance unit sues Mirae of South Korea to complete US$5.8 billion US luxury hotel deal

Anbang seeks to compel Mirae to conclude deal after pandemic slams hotel occupancy rate below 10 per cent in many cities

Sale and purchase agreement was slated to close on April 17 amid financing problem, people familiar said

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People walk past a building of Anbang Insurance Group in Beijing, whose insurance business later came under Dajia Insurance after two years of state rehabilitation. Photo: Kyodo

Published: 10:26am, 28 Apr 2020Updated: 10:39pm, 28 Apr 2020

An Anbang Insurance Group unit sued to force South Korea’s Mirae Asset Global Investments to complete its US$5.8 billion purchase of a portfolio of US luxury hotels as the coronavirus pandemic roils financial markets and travel.

In a public summary of the lawsuit filed under seal in Delaware on Monday, officials of the Anbang unit said it “seeks an order forcing defendants to specifically perform their obligations under a sale and purchase agreement and certain equity commitment letters.”

The deal, in which Mirae placed a 10 per cent deposit in September 2019, was slated to close on April 17, people familiar with the matter said.

The Anbang unit has alleged that Mirae is suffering from buyer’s remorse because of hotel closures caused by the pandemic and it has been unable to secure favourable terms for financing, said the people, who requested anonymity because the matter is private.

Mirae officials had asked the Beijing-based insurer for more time to close the deal because the required debt financing is not immediately available. A representative could not immediately be reached outside regular Korean business hours.

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