Investment Bankers Line Up to Dismantle Anbang’s Global Empire

Bloomberg News

With assistance by Vinicy Chan, Dinesh Nair, Steven Yang, Emma Dong, and Ken McCallum

  • Once-acquisitive insurer prepares to unravel buying binge
  • Advisers pitched Anbang in Beijing earlier this month

Investment banks are lining up to manage potential divestments by Anbang Insurance Group Co., the once-acquisitive Chinese insurer that snapped up assets around the world before being seized by the government.

Officials from Anbang and the Chinese banking and insurance regulator are interviewing advisers to arrange the sale of parts of the insurer’s portfolio, people with knowledge of the matter said, asking not to be identified because the information is private. Some bankers were in Beijing earlier this month to pitch for the work, according to one of the people.

Any bank hires would mark the formal start of Anbang unraveling its buying binge, after the Chinese government said in February that it would consider “all or partial” sales of its assets. Anbang first gained global prominence in 2014 with the $1.95 billion purchase of New York’s Waldorf Astoria hotel and continued its spree by snapping up financial companies such as Dutch insurer Vivat NV and marquee properties around the world like San Francisco’s Westin St. Francis.

The spree came to an abrupt end last June, when regulators detained Anbang’s Chairman Wu Xiaohui as part of a wider crackdown on risks in the financial system. Wu was accused of masterminding a $10.4 billion fraud, using unauthorized sales of investment-type policies to prop up the acquisitive company’s capital. China announced a capital injection into Anbang this month aimed at ensuring solvency and protecting policy holders’ interests.

“Significant asset dispositions should be expected,” Brock Silvers, managing director at Kaiyuan Capital, said Friday. “Given that the government just had to inject about $10 billion to protect the retail purchasers of Anbang’s insurance products, it’s a safe bet that all assets are available.”

Luxury Portfolio

Advisers may also help find new investors to buy a stake in Anbang, the people with knowledge of the matter said. Vivat’s 2.375 percent 2024 bonds shed losses Thursday to rise as much as 0.14 cent on the euro.

The China Banking and Insurance Regulatory Commission didn’t immediately respond to a fax seeking comment. Anbang currently has no plan to dispose assets, its public relations department said in response to Bloomberg queries.

Anbang bought Vivat in 2015 and agreed to invest 1.35 billion euros ($1.7 billion) to recapitalize the company. The next year, it acquired Strategic Hotels & Resorts Inc. for about $6.5 billion, gaining a portfolio of luxury properties including the Westin St. Francis and JW Marriott Essex House in New York. The Chinese company also owns controlling stakes in South Korea’s Tongyang Life Insurance Co., Antwerp-based insurer Fidea NV and Belgian lender Nagelmackers.

A QuickTake explainer on Anbang’s struggles

The Chinese government has been seeking to broker the sale of a stake in Anbang, Bloomberg News reported in January. Regulators said last week that Anbang will start the selection of strategic investors and aim to introduce private capital as soon as possible.

China’s pledge to rein in overseas dealmaking has prompted a reversal of a spree that many conglomerates had embarked upon in recent years. HNA Group Co. is disposing billions of dollars worth of assets spanning hotels to property, and Singapore’s Temasek Holdings Pte is studying potential investments in its Swissport Group and Gategroup Holding AG units, people with knowledge of the matter said this week.

CEFC China Energy Co. plans to sell its entire property portfolio with a book value of more than $3.2 billion, people familiar with the matter said last month.