Thursday March 20, 07:45 AM
China's Ping An wants 50 percent of Fortis management arm
SHANGHAI (AFP) - China's Ping An Insurance said it plans to buy a 50-percent stake in the asset management arm of Belgian-Dutch financial group Fortis (Amsterdam: FOO.AS - news) for 2.15 billion euros (3.35 billion dollars).
The Chinese insurer has entered a non-binding memorandum of understanding with Fortis on the purchase of the stake in Fortis Investment Management NV/SA, it said in a statement with the Shanghai Stock Exchange late Wednesday.
The two companies will continue talks on the proposed deal, aiming to reach a final agreement by the middle of next month, it said.
Ping An paid 1.81 billion euros at the end of November (Frankfurt: A0S9N7 - news) for a 4.18-percent stake in Fortis, making China's second-largest life insurer the biggest single shareholder in the Belgian-Dutch group.
It (Frankfurt: A0MLX5 - news) has increased its stake in Fortis to 4.99 percent as of January 22 from 4.18 percent through the purchase of shares on the open market, according to Wednesday's statement.
Ping An said the proposed deal would "further improve its integrated platform of financial services, rapidly increase its asset management capability and enhance the process of the company's globalisation."
"This transaction supports the implementation of our balanced 'three business pillars' strategy, focusing on insurance, banking and investments/asset management," chief executive Ma Mingzhe said in a statement.
"The partnership with Ping An will provide us with unique access to the fast-growing Chinese and Asian markets," Fortis chief executive Jean Paul Votron said.
Ping An Insurance net profit for 2007 more than doubled to 18.7 billion yuan thanks to a jump in investment income.
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