Last week, regulators spoiled the game for Primus Financial Holdings by rejecting its consortium’s US$2.2 billion bid for Nan Shan Life Insurance, the local life insurance subsidiary of American International Group (AIG).
That would usually be the end of the story. However, Primus has turned desperate and, according to market sources, is asking almost any financial institution it can find to help it get back in the hunt for Nan Shan.
Primus and its partner China Strategic Holdings have been battling uphill for nearly a year to win regulatory approval for its Nan Shan bid.
However, the Ministry of Economic Affairs’ Investment Commission turned down the application because the Financial Supervisory Commission found plenty of reason to doubt that the Hong Kong consortium had the financial wherewithal to run Nan Shan over the long haul.
QUESTIONS REMAIN
Also, China Strategic, the main financial backer of the consortium, denied being funded from China. However, the accusations were never conclusively disproven.
Primus now seems caught in a downward spiral, publicly scolding the government for the rejection, but also, quietly, trying to find a substitute partner — a partner that cannot be linked to Chinese funds.
Taipei market insiders and media sources say that Primus wants to drop China Strategic and is frantically fishing for a Taiwanese conglomerate or other financial institution. In a move that seems designed to appease the financial commission and attract a new financial backer, Primus is reportedly prepared to offer a 10 percent stake to Nan Shan staff and 45 percent to a new financial partner.
Primus is clearly talking to AIG about such an arrangement. Market sources say that Yuanta Financial Holdings, a securities financial group, has already been approached by Primus. Fubon Financial Holding may be another potential partner because the financial and insurance company has publicly expressed an interest in Nan Shan.
However, Fubon just bought ING’s local insurance subsidiary and the result would be major layoffs, which would again stand to run afoul of the financial commission.
LAST BEST HOPE
Luckily, AIG has at least one attractive alternative. Chinatrust Financial Holding, Taiwan’s third-largest financial institution, made a superior offer of US$2.4 billion to Nan Shan a year ago and has said it wants to renew it, according to Reuters. The Primus/China Strategic bid was only for US$2.2 billion.
The Chinatrust option seems like a no-brainer. Not only is the well-regarded bank willing to pay more, it also knows financial services in Taiwan, something the rejected consortium did not.
SAVING JOBS
AIG is largely owned by the US government and is eager to give back some of the billions the US poured into saving AIG from collapse during the financial meltdown. Taking the better offer would not only return that taxpayer money, it also would also ensure that the Taiwanese insurer continues its operations and creates employment in Taiwan.
Indeed, AIG was threatening to lay off 60 percent of Nan Shan’s workforce unless its deal with Primus was approved.
Chinatrust, which has the local expertise and funds to run a successful operation, is due for serious consideration by AIG. Primus’ time has passed. It’s also long past time to put this year-long saga to rest by closing a deal.
Eugen Iladi is a freelance reporter based in Miami.
Yesterday’s recall and referendum votes garnered mixed results for the Chinese Nationalist Party (KMT). All seven of the KMT lawmakers up for a recall survived the vote, and by a convincing margin of, on average, 35 percent agreeing versus 65 percent disagreeing. However, the referendum sponsored by the KMT and the Taiwan People’s Party (TPP) on restarting the operation of the Ma-anshan Nuclear Power Plant in Pingtung County failed. Despite three times more “yes” votes than “no,” voter turnout fell short of the threshold. The nation needs energy stability, especially with the complex international security situation and significant challenges regarding
Most countries are commemorating the 80th anniversary of the end of World War II with condemnations of militarism and imperialism, and commemoration of the global catastrophe wrought by the war. On the other hand, China is to hold a military parade. According to China’s state-run Xinhua news agency, Beijing is conducting the military parade in Tiananmen Square on Sept. 3 to “mark the 80th anniversary of the end of World War II and the victory of the Chinese People’s War of Resistance Against Japanese Aggression.” However, during World War II, the People’s Republic of China (PRC) had not yet been established. It
There is an old saying that if there is blood in the water, the sharks will come. In Taiwan’s case, that shark is China, circling, waiting for any sign of weakness to strike. Many thought the failed recall effort was that blood in the water, a signal for Beijing to press harder, but Taiwan’s democracy has just proven that China is mistaken. The recent recall campaign against 24 Chinese Nationalist Party (KMT) legislators, many with openly pro-Beijing leanings, failed at the ballot box. While the challenge targeted opposition lawmakers rather than President William Lai (賴清德) himself, it became an indirect
A recent critique of former British prime minister Boris Johnson’s speech in Taiwan (“Invite ‘will-bes,’ not has-beens,” by Sasha B. Chhabra, Aug. 12, page 8) seriously misinterpreted his remarks, twisting them to fit a preconceived narrative. As a Taiwanese who witnessed his political rise and fall firsthand while living in the UK and was present for his speech in Taipei, I have a unique vantage point from which to say I think the critiques of his visit deliberately misinterpreted his words. By dwelling on his personal controversies, they obscured the real substance of his message. A clarification is needed to
RSS