China’s CNinsure Inc. continued its acquisition spree with the announcement that it has signed a definitive agreement to acquire a 60 percent equity interest in Guangxi Xingfu Insurance Agency Co., Ltd., an insurance agency based in Guangxi Province. CNinsure note that it’s the 13th acquisition it has made in Guanxi.
CNinsure said: “Under the terms of the agreement, CNinsure will make an initial cash payment within 10 working days after register change with relevant authority and a deferred consideration, to be paid in 2009, is subject to adjustment based on Xingfu’s financial performance in the calendar year 2008. The transaction is expected to close in the second quarter of 2008 subject to certain consents, authorizations and other customary closing conditions. Upon completion of the transaction, Xingfu’s management team will continue to lead the company.”
The Xingfu agency is headquartered in Liuzhou, Guangxi Province. It specializes in P/C lines. CN insure noted that it started in 1999, “distributing auto insurance on ancillary basis as an auto service provider. Through nine years’ efforts, it has secured a leading position in Guangxi Province, ranked No. 1 in Guangxi in 2006 and 2007 in terms of revenue, according to figures released by the China Insurance Regulatory Commission.”
CNinsure’s Chairman and CEO Yinan Hu commented: “The highly fragmented nature of China’s insurance intermediary market calls for consolidation. We believe that CNinsure, with 10 years of operating history and supported by capital from our IPO, is well positioned to capture the consolidation opportunities in the insurance intermediary market.”
Ed. Note: If CNinsure realizes its ambitions and maintains the pace it has set for acquiring smaller agencies, it looks set to become China’s equivalent of Aon or MarshMac – watch this space.
Source: CNinsure Inc. – http://www.cninsure.net