Anbang Insurance Plans $2 Billion IPO, on Heels of Waldorf Astoria Purchase

November 12, 2014
Anbang Insurance Group Co., the Chinese insurer buying New York’s Waldorf Astoria hotel, is planning an initial public offering that could raise about $2 billion, people with knowledge of the matter said.

The Beijing-based company aims to start the share sale as early as next year and prefers Hong Kong as a listing destination, the people said. The plans are still at an early stage and could change, according to the people, who asked not to be identified because the information is private.

Anbang, with about 700 billion yuan ($114 billion) of assets according to its website, is branching out into new areas in a push resembling that of Warren Buffett’s Berkshire Hathaway Inc. The company, which agreed to buy Belgian insurer Fidea NV last month, said Oct. 30 it’s seeking further acquisitions globally and will hire several thousand people to support its expansion.

“It appears that Anbang has ambitions for a conglomerate to emulate the Berkshire Hathaway model,” Linda Sun-Mattison, an analyst at Sanford C. Bernstein & Co. in Hong Kong, said by e-mail. “This would entail continued and probably large funding needs.”

The insurer, founded in 2004, has more than 3,000 outlets across China and more than 20 million customers, its website shows. Anbang’s shareholders include state-owned Shanghai Automotive Industry Corp., according to the Beijing Administration for Industry and Commerce’s corporate information database.

Anbang’s media department didn’t immediately respond to an e-mail seeking comment.

Wing Hang Bank

A $2 billion Hong Kong share sale would be the biggest by a Chinese insurance company in the city since People’s Insurance Co. Group of China Ltd.’s $3.6 billion IPO in November 2012, according to data compiled by Bloomberg. New China Life Insurance Co., the nation’s third-largest life insurer by premiums, raised $1.9 billion through a dual listing in Hong Kong and Shanghai in December 2011, the data show.

Anbang agreed in October to buy the 83-year-old Waldorf Astoria hotel for $1.95 billion, after weighing a bid for Hong Kong’s second-largest family-run lender Wing Hang Bank Ltd. earlier this year, people familiar with the matter have said. It will increase its global asset allocation with a focus on North America and Europe, according to its Oct. 30 statement.

The company is the eighth-largest life insurer in China, with a 3.7 percent market share by premium income in the first nine months of the year, according to the insurance regular. Its property and casualty business ranked 17th in the market.

Anbang holds 9 percent of China Merchants Bank Co.’s Shanghai-traded shares, valued at about $3.3 billion based on today’s price, and a $1.1 billion stake in China Minsheng Banking Corp., data compiled by Bloomberg show. Its property and casualty unit owns 35 percent of Chengdu Rural Commercial Bank Co., according to the southwestern Chinese lender’s 2013 annual report.

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