China Oceanwide and Genworth Push Deal Deadline Back to June 30

The companies appear to imply in the announcement released today that they are pushing the deadline back because of issues related to financing as well as issues related to getting regulatory approvals.

"This three-month extension is a prudent step the parties are taking because of the significantly higher volatility and substantially reduced liquidity in the global financial markets due to the coronavirus pandemic, which has negatively impacted financing global acquisitions," the companies said in the announcement.

"Given the unprecedented market disruptions, Oceanwide and Genworth believe it is prudent to build in a cushion and extend the deadline to no later than June 30, 2020," the companies said. "The parties expect that Oceanwide's existing financing arrangement for debt funding of up to $1.8 billion through Hony Capital will be extended through June 30, 2020."

Lu Zhiqiang, chairman of China Oceanwide, said in a comment included in the announcement that China Oceanwide remains fully committed to the Genworth transaction.

"I believe the long-term value of Genworth to the Oceanwide family of companies remains very compelling," Lu said. "However, in light of the impact of the coronavirus pandemic on global financial markets, it makes sense to extend the merger agreement to June 30, 2020."

Tom McInerney, Genworth's chief executive officer, said Genworth also remains fully committed to closing the transaction as soon as possible.

"The parties are very pleased with the progress made in receiving approval from the New York and Virginia regulators," McInerney said. "We understand the necessity of the current extension in light of the unprecedented challenges in global financial markets."

— Read New Coronavirus Hangs Over China Oceanwide Affiliate's Board Meeting, on ThinkAdvisor.

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