Equity Analyst: Capital Pressure Pushes Taikang Life to Shuffle Investors Ahead of IPOs
By Rebecca Ng | |
A.M. Best Company, Inc. |
Following the completion of the equity transfers,
The equity transfer is "a short-term capital investment, which can help ease the profit margin pressure of Taikang Life, avoiding it to become insolvent," said
Taikang Life may also "wait and see" what the market response will be to the proposed dual listings of PICC (Group), the holding company of
The regulator did not provide financial details of the equity transfer, while noting
Last year, investment banker Goldman Sachs won regulatory approval to acquire a 12.02% stake in Taikang Life, becoming the second-largest shareholder of the insurer. This was the first investment move involving Taikang Life after its original largest stakeholder — French insurer
The Taikang Life stake was acquired by Axa through a Winterthur transaction in 2006.
Taikang Life was established in
At the end of 2010, the insurer reported a solvency margin ratio of 175, down 29% from a year earlier, as the company required capital for business development and dividend distributions, as well as the impact of volatile capital markets.
In 2011, the insurer generated total original premium income of
(By
Copyright: | (c) 2012 A.M. Best Company, Inc. |
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