Transglobe Life Insurance Inc (全球人壽) yesterday flatly denied media reports that it is in talks with Jih Sun Financial Holding Co (日盛金控) to become a subsidiary of the conglomerate.
The Chinese-language Commercial Times yesterday ran a front-page story saying Jih Sun plans to acquire a 25 percent stake in Transglobe through a share swap that could be settled after the end of the Lunar New Year holidays next month.
“The report is absolutely inaccurate. The company’s goal to become a pension-planning expert remains unchanged since its entry to the local market in 1994,” Transglobe said in a statement.
The insurer, which incorporated the insolvent Kuo Hua Life Insurance Co (國華人壽) into its operations last year after winning a record NT$88.37 billion (US$2.91 billion) in compensation from the government in late 2012, is bound by contract not to sell shares for seven to 10 years.
Such a share swap plan is totally unacceptable, the Financial Supervisory Commission said.
Zhongwei Co (中瑋一), a Taipei-based financial investment company and the sole shareholder of Transglobe, is reportedly in talks with Jih Sun Financial to expand the insurer’s sales channel and profitability, Commercial Times said, without citing sources.
Transglobe said it has made financial improvement after the integration with Kuo Hua and will press ahead with its goal of becoming a top provider of protection-type insurance policies.
The reported merger would boost assets of Jih Sun Financial to more than NT$900 billion and provide Transglobe with more flexibility in raising funds to meet capital adequacy requirements, local media said.
The commission said it has no knowledge of such a merger plan and it would reject an application if one were filed.
Commission officials said they would look into potential share price manipulations, because Transglobe knows about the ban on share transfers.