Responding to criticism from several board directors and supervisors, Waterland Financial Holdings Co’s (國票金控) biggest shareholder yesterday defended the company’s planned acquisition of Metlife Inc’s insurance business in Taiwan.
“Waterland Financial outdid several rivals in winning the right to acquire Metlife Taiwan (大都會人壽), which has a net worth of NT$8 billion [US$251 million], for approximately NT$3.5 billion — a deal endorsed by [Waterland’s] major shareholders,” read an advertisement in two local business dailies yesterday by Hotel Taipei Miramar (美麗華飯店), which has a 27 percent stake in the financial service provider.
Miramar also accused Nice Group (耐斯集團), which has a 7 percent stake in Waterland Financial, of withdrawing its earlier support for the acquisition after Miramar refused to relinquish its right to appoint a new chairman at Metlife Taiwan to Nice, the ad said.
James Wei (魏憶龍), a board director at Waterland who represents Nice Group, rejected the allegations.
Wei said by telephone yesterday that Miramar’s advertisement proved that the remaining 66 percent of Waterland Financial’s shareholders did not have a say in the company’s major acquisition plan, whose appraisal process was seriously flawed, he added.
Wei and independent director Joe Wu (吳永乾), along with two board supervisors, on Monday called on the board to halt the planned merger, which they said was “overpriced.”
Wei told a media briefing that with a “flawed” financial appraisal, the deal “will put the rights of the company’s more than 100,000 individual shareholders at risk.”
Wei yesterday reiterated his hope that the financial regulator would look into and disapprove the “loss-making” merger deal.
Hours after Wei’s media briefing, Waterland Financial, the nation’s smallest financial service provider, said in a stock exchange filing that its third-party financial appraisal showed that based on the life insurer’s 10-year cash liquidity, if the return on the acquisition deal exceeds 5 percent, Metlife Taiwan will only incur a loss of NT$100 million this year before turning a profit of NT$427 million next year.
However, if the deal’s return falls below 3.3 percent, Metlife Taiwan will remain in the red for the next four years, the filing said.
The company yesterday said the board had thoroughly discussed the proposed acquisition before company chairman Steven Hung (洪三雄) inked the contract late last month with US-based Metlife Inc to acquire all the shares of its local arm for US$112.5 million, pending a regulatory approval.
At an extraordinary board meeting yesterday, the board proposed a motion to dismiss the board directors and supervisors appointed by Nice Group. The motion will be discussed and finalized at its annual shareholder meeting scheduled on June 25, another exchange filing said.
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