Exclusive: Anbang's Fidelity & Guaranty acquisition set to fall through - sources

Sun Apr 16, 2017 6:41pm EDT
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By Koh Gui Qing and Greg Roumeliotis

(Reuters) - China's Anbang Insurance Group will let its agreement to acquire U.S. annuities and life insurer Fidelity & Guaranty Life (FGL) (FGL.N: Quote) for $1.6 billion lapse, after failing to secure all the necessary regulatory approvals, people familiar with the matter said on Sunday.

The development casts new doubt on Anbang's commitment to U.S. deals, following its abandoned attempt last year to acquire Starwood Hotels & Resorts Worldwide Inc for $14 billion.

Marriott International Inc (MAR.O: Quote) ended up buying Starwood.

While Anbang's FGL acquisition had received clearance from the Committee on Foreign Investment in the United States (CFIUS), a U.S. government panel that scrutinizes deals for potential national security concerns, it could not get past some U.S. state regulators.

FGL had extended its merger agreement with Anbang, which was signed in November 2015, to April 17 after it was set to expire on Feb. 8. Had Anbang secured a public hearing with Iowa's financial regulator by April 17, it could have extended the expiration date to May 31.

However, Anbang has failed to meet the conditions for any further extension, the sources said. Anbang also needed approval from New York financial regulators, but it has abandoned efforts to secure it, the sources added.

The sources asked not to be identified because the recent developments are confidential.

The sources did not say why Anbang could not secure approvals from U.S. state regulators after clearing CFIUS, but noted that the Beijing-based group had pushed back against making some of the disclosures required.   Continued...

FILE PHOTO: The headquarters building of Anbang Insurance Group are pictured in Beijing, China, August 25, 2016. REUTERS/Jason Lee/File Photo