Genworth and Oceanwide Extend Merger Agreement

2020 JAN 03 (NewsRx) -- By a News Reporter-Staff News Editor at Mergers & Acquisitions Daily News -- Genworth Financial, Inc. (NYSE: GNW) and China Oceanwide Holdings Group Co. Ltd (Oceanwide) announced they have agreed to a 13th waiver and agreement of each party’s right to terminate the previously announced merger agreement. The 13th waiver and agreement extends the previous deadline of December 31, 2019 to no later than March 31, 2020.

The 13th Waiver also provides termination rights for Oceanwide to the extent that regulators subsequently impose materially adverse conditions on the transaction. In addition, the waiver provides that the parties will mutually agree upon a closing date after the receipt of all required regulatory approvals. In the event Genworth and Oceanwide cannot agree on a closing date following receipt of all regulatory approvals, each party has the right to terminate the merger agreement.

Although the Genworth-Oceanwide transaction had previously received all necessary approvals from U.S. regulators, the parties recently provided supplementary information to certain regulators to reflect the Genworth Canada disposition and the passage of time since their prior approvals. The approval of the New York Department of Financial Services (NYDFS) expired earlier in the year and the parties are in discussions with the NYDFS to secure an appropriate reapproval. Fannie Mae and Freddie Mac also will need to reapprove the Oceanwide transaction, while other regulators are currently reviewing the supplemental information to determine whether it has any impact on their existing approvals.

“The extension allows significant additional time for regulators to complete their review of updated information including the recent sale of our Canadian mortgage insurance business, and for the NYDFS to review the results of our New York subsidiary’s annual assumption and margin reviews, which they have linked to their re-approval of the transaction,” said Tom McInerney, president and CEO of Genworth Financial. “We continue to believe the transaction with Oceanwide provides the best, most certain value for Genworth stockholders.”

Added LU Zhiqiang, chairman of Oceanwide: “Despite the delays, we remain fully committed to this transaction and look forward to the successful completion of the transaction.”

Following the receipt of all final Genworth regulatory approvals, Oceanwide will also need to receive clearance from China’s State Administration of Foreign Exchange, or SAFE, for the currency conversion and transfer of funds.

Genworth and Oceanwide remain committed to satisfying the closing conditions under the merger agreement as soon as possible.

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