AIG isn’t the only company that’s seeking to strengthen its already historic roots in China. HSBC Holdings Plc. (once known simply as the Hong Kong and Shanghai Bank) announced that it is on the point of receiving a joint venture insurance license.
The news came on the same day that PICC Property and Casualty Co. Ltd., (formerly Peoples Insurance Company of China) the country’s largest property insurer, said it would realize around U.S.$693 million from its initial public offering. The price for the three billion plus shares it will offer was set at HK$1.80 (slightly over 23 cents), higher than most estimates.
PICC had originally planned to raise $654 million from the sale. Public trading on the Hong Kong Sock Exchange is set to begin next week.
At least part of those shares have already been sold, as AIG announced on October 10 that it would buy a 9.9 stake in the company. AIG is expected to pay around U.S.$245 million for the investment.
HSBC will have a 24.9 percent stake in Beijing HSBC Insurance Brokers Ltd. with two Chinese investment companies owing the remaining shares. The company will have an initial capitalization of approximately $1.9 billion. It will specialize in marine, aviation and other transport sectors, health care and reinsurance.
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