China’s Fosun Buys 80% of Portugal’s Caixa Insurer for $1.36 Billion

January 10, 2014

China’s Fosun International Ltd. bought 80 percent of Portugal’s Caixa Geral de Depositos SA’s insurance unit for €1 billion ($1.36 billion), beating out U.S. buyout firm Apollo Management International LLP.

Fosun International will buy the stake in the insurer with its own funds, Secretary of State for Finance Manuel Rodrigues told reporters in Lisbon yesterday.

Portugal is selling the company as a condition for a €78 billion [$106 billion] European Union bailout, which requires the government to dispose of assets and raise revenue. Fosun International, the investment arm of China’s biggest closely held industrial group, is seeking to diversify its holdings overseas and won the approval to buy French resort operator Club Mediterranee SA with AXA Private Equity in July.

Fosun International has an insurance venture with U.S. life insurer Prudential Financial Inc. and operates Peak Reinsurance in Hong Kong. It also owns a stake in Greek duty-free store operator and jewelry maker Folli Follie.

Chairman and billionaire Guo Guangchang said in an interview in New York last month that he is seeking to expand the company’s U.S. commercial real estate investments after the acquisition of New York’s 1 Chase Manhattan Plaza.

Fosun International shares rose to the highest in three weeks, climbing 4.6 percent to HK$7.58 as of 2:04 p.m. in Hong Kong.

New York Building
The company bought the 2.2 million-square-foot (204,000- square-meter) Chase Manhattan tower for $725 million in October. It is the biggest purchase of a New York building ever by a Chinese company, and caps a year in which Chinese investors made some of the city’s most high-profile real estate deals last year.

Portugal has raised €8.1 billion [$11 billion] from asset sales, Rodrigues said.

Last month, Portugal sold the nation’s postal service CTT- Correios de Portugal in the first IPO since 2008, after completing the sale of airport operator ANA-Aeroportos de Portugal SA to Vinci SA in September for €3 billion [$4 billion]. It has also sold stakes in utility EDP-Energias de Portugal SA and electricity grid operator REN-Redes Energeticas Nacionais SA.

With assistance from Bonnie Cao in Shanghai.
Editors: Mark Bentley, Frank Connelly

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