Kuo Hua Life Insurance’s (國華人壽) shareholders yesterday approved a proposal to cut the company’s capital by NT$2 billion (US$60.8 million) before injecting NT$4 billion to alleviate immediate pressure of a takeover by financial regulators.
But the life insurer had yet to provide a timetable for the completion of the capital-raising plan by its shareholders.
The company’s original shareholders include Wong Da-ming (翁大銘) and his three siblings, who combined have a controlling 60 percent stake; Miramar Group (美麗華集團) and its related enterprises, with a more that 20 percent stake; and Lung Yen Group (龍巖集團), with a 5 percent stake.
Once the cash injection is completed, the life insurer’s working capital will grow from NT$3.01 billion to NT$5.01 billion, the company said.
A company executive who declined to be named rebutted reports by media that Lung Yen was interested in taking up a bigger stake by injecting NT$4 billion into the life insurer. He said Lung Yen representatives did not show up at yesterday’s shareholders’ meeting.
Kuo Hua does not rule out the possibility of planning on raising more capital to write off its losses, he said.
As of May, Kuo Hua had suffered a net loss of NT$55.9 billion following massive investment losses. The firm was required by the Financial Supervisory Commission to strengthen its capital structure before last month or face government takeover.