China Evergrande Group plans to sell its insurance unit to a state-backed company, according to people familiar with the matter, marking the latest disposal by the defaulted property giant.
(Bloomberg) — China Evergrande Group plans to sell its insurance unit to a state-backed company, according to people familiar with the matter, marking the latest disposal by the defaulted property giant.
An unidentified state-owned entity in Shenzhen is poised to take over Evergrande Life Assurance Co. and in discussions to rename it Hai Gang Life Insurer, the people said, asking not to be named because the matter is private. Details of the transaction, including the pricing and ultimate ownership structure, are yet to be finalized, said the people. Evergrande currently owns 50% of the life insurer.
Evergrande and the life insurance business didn’t respond to requests for comment.
Evergrande sits at the center of a credit crisis that has rippled through China’s real estate sector and curtailed growth in the world’s second-largest economy. The debt-laden developer has offloaded a range of assets, including trophy land parcels and stakes in other financial institutions.Â
Last September, it exited its investment in Shengjing Bank Co. under a deal brokered by the local government, Bloomberg reported at the time.Â
Among land divestments, last year the developer sold a site once reserved to build its Shenzhen headquarters in a 7.5 billion yuan ($1 billion) deal. It has also returned a plot of land meant for an 80,000-seat football stadium in Guangzhou, and sold unfinished property projects to buyers including local government financing vehicles.
Evergrande is trying to win support from creditors for a massive offshore debt restructuring proposal. It also faces billions of dollars in litigation following its default in late 2021.Â
–With assistance from Zhang Dingmin.
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