Tengbang International’s stake in Foresea Reinsurance was put up for judicial auction at an estimated value of rmb330 million

2022-05-05 0 By

Estimated at 330 million yuan, 10% stake in Foresea Reinsurance Co., LTD. (hereinafter referred to as “Foresea Reinsurance”) will be auctioned on March 4.On February 7, reporters from Beijing Business Daily noticed that jd’s judicial auction platform will auction 10% of Qianhai Reinsurance on March 4, 2022.This equity is owned by Tengbang International Business Services Group Co., LTD. (hereinafter referred to as “*ST Tengbang” or “Tengbang International”), a shareholder of Foresea Re, and is currently under pledge and frozen.Industry insiders said that reinsurance companies have a certain scarcity of equity, given the profitability of Foresea Re, although 10 percent of the stake can not become a controlling shareholder, but also has a certain investment.On February 7, reporters from Beijing Business Daily noticed that the Guangzhou Intermediate People’s Court of Guangdong Province posted an auction notice on the auction platform of JD.com, saying that 10% of Qianhai Reinsurance will be auctioned from 10:00 am on March 4, 2022 to 10:00 am on March 5, 2022.This equity is owned by *ST Tengbang, the equity valuation and the starting price are 330 million yuan, as of press release there are 745 people around, no one signed up for bidding.The solvency report of Foresea Re shows that *ST Tengbang is one of the seven shareholders of Foresea Re, holding 10% of the shares, which are currently under pledge and frozen.Founded in 2016, Qianhai Reinsurance is China’s first Chinese reinsurance company initiated and established by social capital, with registered capital of 3 billion yuan. *ST Tengbang is one of its founding shareholders.In addition to *ST Tengbang, Foresea Reinsurance has six shareholders, among which three are state-owned shareholders, namely Foresea Financial Holdings Co., LTD., China Post Group Co., LTD., and Shenzhen Capital Operation Group Co., LTD., which each hold 20%.The other three shareholders are social legal shares, including astra Holding 14.5%, Septwolves Industrial Holding 10.5% and Kai Tian Holding 5%.Industry insiders said that the current number of domestic reinsurance companies is relatively small, the equity of reinsurance companies has a certain scarcity.Beijing Business Daily reporter found that China has a total of 14 reinsurance companies, of which 8 are foreign-funded companies.What is the performance of Foresea Reinsurance?According to the annual report, Foresea Re made a profit for the first time in 2019, achieving a net profit of 52 million yuan and a net profit of 205 million yuan in 2020.Since its establishment, Foresea Re has been rated “A-” by Bayes International for six consecutive years.The performance is not bad. Is the 10% of Foresea Reinsurance attractive?Yang Xuan, founder of Warp Capital and Baoguan, analyzed that, first of all, the auction price of 330 million yuan did not appear too much premium;Second, The shareholding structure of Foresea Re is simple, and the three major shareholders are local state-owned companies in Shenzhen.Overall, the stake is attractive, given Foresea’s earnings and the scarcity of equity in reinsurers.If from the investment point of view, it is worth investing.”But there are also some disadvantages. Foresea Reinsurance was established in 2016, which is a short time ago, and reinsurance companies’ operations are more dependent on the accumulation of data, human and financial resources.Moreover, Compared with other companies, Qianhai Re does not have the backing of large conglomerates.A 10 per cent stake does not give new shareholders much say.”Yang Xuan added.If the equity auction is successfully completed, the shareholders of Foresea Re will change. If the equity owner changes, what will be the impact on Foresea Re?In an interview with Beijing Business Daily, Foresea Re said, “Tengbang international holds 10% of our equity and is a financial class II shareholder.Tengbang International holdings of our company’s equity is auctioned, will not lead to a reduction in the company’s registered capital, the company’s continued steady operation has no direct impact.The company will pay close attention to the auction and do a good job in accordance with regulatory regulations.”Xu Yuchen, a senior actuary, also said that The shareholding structure of Qianhai Re is relatively concentrated, and the acquisition of 10% of the shares cannot become its major shareholder or controlling shareholder, and the change of 10% of the shares will not have a great impact on its operation and management.Yang Xuan believes that although the 10% equity change will not bring much impact to Foresea Re, if the new shareholders with strong capital strength or reinsurance business requirements can increase their capital or form business coordination with Foresea Re, it will bring some development opportunities to Foresea Re.At present, China is already the world’s second largest direct insurance market, many industry insiders and institutions are predicting that China will become the world’s largest insurance market, as the “insurance of insurance”, what is the development prospect of the reinsurance market?What opportunities will the reinsurance companies represented by Qianhai Re embrace?Xu yuchen pointed out that reinsurance companies “direct insurance” is the development trend of the industry.In other words, the boundary between reinsurance companies and direct insurance companies will become increasingly blurred in the future. Some reinsurance companies will launch products to the market after finding sales channels.Yang pointed out that based on international experience, some reinsurance companies will choose to directly cooperate with insurance brokers to launch insurance products through insurance brokers.Although China’s reinsurance market has a relatively short history, the domestic reinsurance market has great potential for development, Qianhai Reinsurance said in an interview with Beijing Business Daily.According to the latest statistics released by the China Banking Insurance Regulatory Commission (CBRC), in 2021, the insurance industry will realize a total of 4.49 trillion yuan in original premium income, while there are only 14 domestic reinsurance companies, the domestic reinsurance market has great growth potential.Foresea Reinsurance will continue to take sound operation as the cornerstone, risk prevention and control as the guarantee, innovation and development as the driving force, value creation as the guidance, focus on traditional reinsurance business and technology enabling, and strive to become a leading innovative reinsurance company in the world.Beijing Business Daily reporter Chen Tingting Li Xiumei statement: reprint this article is for the purpose of passing more information.If the source is wrong or violated your legitimate rights and interests, please contact the author with proof of ownership, we will promptly correct, delete, thank you.Email address: newmedia@xxcb.cn