The board of China Life Insurance Co (中國人壽) yesterday agreed to acquire the assets and liabilities of PCA Life Assurance Co (保誠人壽), a local arm of Prudential Plc, excluding its bancassurance and telephone marketing businesses for the nominal sum of NT$1, company executives said.
In exchange, the British insurer will pay NT$2.183 billion (US$62.7 million) for 145.5 million common shares in China Life at NT$15 per share through a private share placement, China Life senior vice president Tony Hsu (許東敏) told a media briefing.
After the capital injection, Prudential Plc will become the Taiwanese life insurer’s largest shareholder, with a 9.95 percent fully diluted stake.
The deal was expected to be completed by the third quarter of this year, pending regulatory approvals, a press statement said.
After the merger, China Life will leap to become the nation’s fourth-largest life insurer with a market share of 8.35 percent in first-year premiums, up from its current 6.08 percent market share. Its assets will increase from NT$313.2 billion to NT$508.8 billion and it will have a clientele of 1.55 million policyholders, up from 610,000, the statement said.
In its filing to the Taiwan Stock Exchange yesterday, PCA Life said its net assets totaled more than NT$5 billion.
Tony Wilkey, chief operating officer of Prudential Asia, said the rights of existing policyholders and employees would be safeguarded and the firm would continue to invest in the local market. The transaction will give Prudential Plc stronger capital reserves, he said.
As an EU domiciled company, Prudential adheres to the EU Insurance Group Directive (IGD), under which it is required to carry significant economic capital reserves.
Upon the transaction’s completion, there would be a net increase in Prudential’s IGD surplus of approximately £700 million (US$1 billion) to £800 million, further strengthening its already robust IGD position, Wilkey said.
China Life president Alan Wang (王銘陽) said that the partnership would help his company build a complete agency channel after retaining some of PCA Life’s 10,000 agencies, while leveraging Prudential’s sales channels to sell its own policies.
Policies sold by agencies would bring in premiums for China Life, while Prudential maintains its sales via bancassurance and telephone marketing channels, he said.
PCA Life vice president Daphne Wang (王淑華) said that the parent UK insurer’s bancassurance partnership with Standard Chartered Bank would not be affected by the China Life transaction, while it will maintain its 5 percent stake in E.Sun Financial Holding Co (玉山金控).
TECH RACE: The Chinese firm showed off its new Mate XT hours after the latest iPhone launch, but its price tag and limited supply could be drawbacks China’s Huawei Technologies Co (華為) yesterday unveiled the world’s first tri-foldable phone, as it seeks to expand its lead in the world’s biggest smartphone market and steal the spotlight from Apple Inc hours after it debuted a new iPhone. The Chinese tech giant showed off its new Mate XT, which users can fold three ways like an accordion screen door, during a launch ceremony in Shenzhen. The Mate XT comes in red and black and has a 10.2-inch display screen. At 3.6mm thick, it is the world’s slimmest foldable smartphone, Huawei said. The company’s Web site showed that it has garnered more than
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
Vanguard International Semiconductor Corp (世界先進) and Episil Technologies Inc (漢磊) yesterday announced plans to jointly build an 8-inch fab to produce silicon carbide (SiC) chips through an equity acquisition deal. SiC chips offer higher efficiency and lower energy loss than pure silicon chips, and they are able to operate at higher temperatures. They have become crucial to the development of electric vehicles, artificial intelligence data centers, green energy storage and industrial devices. Vanguard, a contract chipmaker focused on making power management chips and driver ICs for displays, is to acquire a 13 percent stake in Episil for NT$2.48 billion (US$77.1 million).