Tianan Property Insurance Offers Its Assets for $314 Million

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Tianan Property Insurance Co., a government-seized affiliate of Tomorrow Holding, put up its assets for sale as regulators unwind the troubled conglomerate’s sprawling empire.

Tianan listed its insurance assets at the Shanghai United Assets and Equity Exchange Thursday, seeking bidders with an asking price of 2.1 billion yuan ($314 million). The assets for sale include Tianan’s financial and nonfinancial assets, liabilities and insurance businesses, according to public information. Tianan also demanded that potential buyers take on its employees unconditionally.

Some analysts expressed concern that Tianan is asking too much for the assets. According to the company’s financial report, its total assets stood at 14.4 billion yuan while liabilities mounting to 15.2 billion yuan. Tianan said it would seek alternative ways to dispose of the assets if no qualified buyers are found.

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Potential buyers could be property insurers or noninsurance companies looking for strategic investment in the business. Both single-entity bidders and consortiums that meet regulatory requirements are acceptable, Tianan said.

Tianan is one of nine affiliates of Tomorrow Holding seized in July 2020 by regulatory authorities citing lawbreaking. The companies, with businesses spanning insurance, securities, trust and futures, were formerly controlled by fallen tycoon Xiao Jianhua.

The seizure marked a major step in dismantling the business empire built by Xiao under the umbrella of Tomorrow Holding, one of the highest-profile targets of China’s crackdown on financial risks. Xiao, once one of China’s richest men, was placed under graft investigation by Chinese authorities in January 2017. Officials haven’t disclosed the specifics of the investigation.

In July 2021, regulators extended the one-year seizure of the nine enterprises by another year to “further promote risk disposal work and defuse financial risks.” The extended custody is set to end July 16.

In late May, the securities regulator terminated its custody of New Times Securities, one of the nine companies, after central government-backed investment company China Chengtong Holdings Group acquired more than 98% of the brokerage. New Times was approved to continue in business.

There was speculation that Rongtong Property Insurance Co. Ltd., a central government-backed insurer incorporated in April 2021, was in talks to take over Tianan. But a person close to the matter said Rongtong decided to exit the negotiations.

Contact reporter Han Wei (weihan@caixin.com) and editor Bob Simison (bob.simison@caixn.com)

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