On May 20, China's Taiping (00966) and Belgium's Fujie Group (Ageas) held a signing ceremony in Hong Kong. Fujie plans to invest 1,075 billion yuan in Taiping Pension Insurance Co., Ltd. (hereinafter referred to as “Taiping Pension”), a subsidiary of China Taiping, to obtain 10% of Taiping's shares. The two sides will cooperate strategically in the field of pension finance in China.
Taiping Pension was founded in 2004. It is an important subsidiary of the central financial institution China Taiping Insurance Group Co., Ltd., which specializes in pension business and employee welfare protection business. It is also the first state-owned professional pension insurance company in China. According to the annual report, as of the end of 2023, Taiping Pension had total assets of 28.328 billion yuan, total revenue of 6.932 billion yuan, and net profit of 9.7935 million yuan. The valuation of Taiping Pension before this capital increase was 9.7 billion yuan, the corresponding implied net market ratio (P/B) was about 3.01 times (the net assets audited by Nikkei in the Taihei Pension Benchmark were 3.119 billion yuan), and the corresponding asset ratio (P/AUM) was about 0.017 times (the pension assets managed by Taiping Pension on the reference date were 587.8 billion yuan).
Fujie Group has a long history of 200 years. It is one of the largest insurance companies in Europe, with premiums exceeding 17 billion euros in 2023. It is in a leading position in the market in Belgium and other countries, and has offices in 13 countries in Europe and Asia. Its business scope covers personal insurance, property insurance, reinsurance, and asset management. Fujie Group is actively expanding the European and Asian insurance markets. In particular, it is actively developing pension asset management business in the European market, and has rich experience in pension fund management.
Zhitong Finance learned that since China Taiping and Fujie Group jointly established the first joint venture Taiping Life Insurance in 2001, Fujie Group has always been China Taiping's most important comprehensive strategic partner. The two sides have continued to deepen cooperation in the fields of personal insurance, reinsurance, insurance asset management, financial services, etc., and have worked together to create a model for cooperation between Chinese and foreign insurance companies. A Xinhua News Agency article commented on the cooperation between the two sides, saying, “We have not only introduced capital, but also introduced advanced insurance management ideas and international talents, which has become one of the examples of open cooperation in the Chinese insurance industry.”
According to public information, up to now, Fujie Group directly and indirectly holds 24.9% of “Taiping Life Insurance” shares, directly holds 20% of “Taiping Asset” shares, directly holds 25% of “Taiping Reinsurance” shares, and directly holds 12% of “Taiping Financial Services”; after the implementation of the Taiping Pension Equity Cooperation Project, the number of joint ventures between the two sides has increased to 5. According to China's Taiping announcement, after 3 years of this transaction, Fujie Group and its subsidiaries can increase their holdings of Taiping Pension by up to 24.99% (including) 24.99% (the above transaction still requires regulatory approval and other agreed conditions before it can be officially implemented).
China's pension finance is in a period of important strategic opportunity and rapid development, and pension insurance and services are nurturing huge market potential. Taiping Pension introduced Fujie as an investor to help supplement capital and provide capital guarantees for expanding the pension insurance business. In addition to capital support, it also provides an “external brain” for product and service innovation. Wang Sidong, Chairman of China Taiping, said, “This cooperation between the two sides will give full play to Fujie Group's experience and advantages in pensions, promote all-round innovation and transformation of Taiping Pension, work together to enhance core competitiveness, and contribute to the development of a multi-level and multi-pillar pension insurance system in China.”
Bart De Sme, chairman of Fujie Group, said that as one of China's important pension insurance companies, it is an ideal platform for Fujie Group to seize opportunities in the Chinese pension finance market. “In the future, we will use common expertise and resources with China Taiping to promote China Taiping to provide better products and services to our customers and continue to expand our market share.”