(Image: Genworth)
Genworth Financial Inc. is now much closer to becoming part of China Oceanwide Holdings Group Co. Ltd.
The Richmond, Virginia-based insurer says it has received approvals for the $2.7 billion China Oceanwide deal from several major regulatory agencies.
Genworth was a major player in the U.S. life and annuity markets. It continues to sell some long-term care insurance (LTCI). It's still a major issuer of mortgage insurance in the United States, Canada and Australia, and it still has large amounts of life, annuity and LTCI business on its books. GLIC has written more LTCI business than any other U.S. issuer.
The Delaware Department of Insurance, the lead regulator for a major Genworth subsidiary, Genworth Life Insurance Company (GLIC), has given the deal its blessing.
Genworth says it also has received approvals from two major U.S. mortgage guarantee agencies, Fannie Mae and Freddie Mac, and from regulators in Australia and New Zealand.
China Oceanwide and Genworth announced the deal in October 2016. They recently pushed the deal completion deadline back to Jan. 31, 2019, from Dec. 1.
The companies still need approvals from other U.S. and non-U.S. agencies, including the New York Department of Financial Services.
Lu Zhiqiang, the chairman of China Oceanwide, said in a statement that his company looks forward to closing the Genworth acquisition transaction as soon as possible.
Genworth and China Oceanwide say they can live with the requirements imposed in connection with the regulatory approvals already received, but Genworth notes in a disclosure statement that one risk is that the companies may face further regulatory approval delays, and that another risk is that other regulators that approve the deal may impose "materially burdensome or adverse regulatory conditions,,, that either or both of the parties may be unwilling to accept."
Genworth has included the warning about burdensome conditions in its standard risk disclosures since it first announced the China Oceanwide deal.
China Oceanwide
China Oceanwide is a privately held, family-owned holding company based in Beijing. It has roots in the real estate development industry but now owns several insurance companies and several other financial services companies.
China Oceanwide has faced challenges of its own in recent years, in part because of Chinese regulators' tougher scrutiny of real estate and financial services companies, and in part because of some affiliates' high levels of debt.
