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Zurich Insurance Sells $943 Million New China Life Stake

An embossed sign sits on a pillar outside Zurich Insurance Group AG's headquarters in Zurich. Photographer: Gianluca Colla/Bloomberg
An embossed sign sits on a pillar outside Zurich Insurance Group AG's headquarters in Zurich. Photographer: Gianluca Colla/Bloomberg

Nov. 21 (Bloomberg) -- Zurich Insurance Group AG sold its entire stake in New China Life Insurance Co. for $943 million, according to deal terms obtained by Bloomberg News, with Swiss Re Ltd. agreeing to buy just over half of the stock.

Switzerland’s biggest insurer offered 292.5 million New China Life shares, representing 9.4 percent of the total issued share capital of the Chinese company, at HK$25 a share, the terms show. Swiss Re, the world’s second-largest reinsurer, said in an e-mailed statement yesterday that it will buy a 4.9 percent stake in New China Life for $493 million.

Zurich Insurance sold 97.5 million shares in the third-biggest Chinese life insurer by premium income in July, causing the stock to drop 6.4 percent, and booked a gain of $441 million in 2011 after selling an initial 5 percent stake to China International Capital Corp. and Nomura Securities Co.

“Our relationship with NCI has been a positive experience for both parties,” Geoff Riddell, Zurich’s chairman for Asia-Pacific, Middle East and Africa, said in an e-mailed statement. “Zurich is very optimistic about the China insurance market, and we remain committed to further developing our presence in China and evaluating potential opportunities as they arise.”

Zurich Insurance said it plans to reinvest the proceeds into investments in Asia. The company said it plans to complete the sale on Nov. 25.

Swiss Re said in the statement that the investment enables it to tap into the growth potential in China, which is the world’s fifth-largest life insurance market.

To contact the reporter on this story: Carolyn Bandel in Zurich at cbandel@bloomberg.net

To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net

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