HSBC’s deal with Thai firm to risk failure: Chinese newspaper
HONG KONG - Agence France-Presse
HSBC is trying to sell its stake in insurer Ping An to a Thai firm.A multi-billion dollar deal in which banking giant HSBC was set to sell its stake in China’s second largest life insurer Ping An to a Thai firm is in danger of collapse, as the South China Morning Post reported.
Chinese regulators were ready to reject the $9.4 billion bid from Thai conglomerate Charoen Pokphand Group over concerns about funding for the bid, reports said.
Post claimed that State-owned China Development Bank, which had agreed to provide loans to help CP Group buy HSBC’s 15.57 percent stake in Ping An, was reconsidering its decision. The China Insurance Regulatory Commission (CIRC) was therefore worried about where the money would come from and whether the Thai firm would be the real buyer of the stake, according to newspaper.
However, The CIRC and Ping An could not be immediately reached, as HSBC did not make any comments on the reports. The collapse of the deal would be a big blow to HSBC, which has been selling its non-core assets as part of a restructuring plan to boost profitability. Besides, London and Hong Kong-listed HSBC is also setting aside hundreds of millions of dollars as provision for fines related to possible criminal charges over money-laundering allegations in the U.S.