Chinese Companies ‘Set Their Sights’ on Allianz; Regulatory Hurdles Halt Talks

Chinese companies Anbang Insurance and HNA Group have separately considered purchasing stakes in the German insurance company Allianz as part of a plan to create a global financial giant, Reuters has learned from informed sources.

The conglomerates were contemplating acquiring a majority stake in the fifth largest insurance company in the world, which has a market value exceeding $95 billion, and HNA was also willing to purchase a minority stake, said two individuals involved in the talks, who wished to remain anonymous due to the sensitivity of the matter.

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The discussions were held separately and did not result in concrete offers, having been halted this year due to anticipated regulatory hurdles in Germany and China and due to weak interest from Allianz’s leadership, the sources noted. There is little likelihood that the plans could be back on the agenda in the near future, one of the sources believes.

Representatives of Allianz, Anbang, and HNA declined to comment to Reuters.

An offer to purchase a controlling stake in Allianz would face political and regulatory obstacles, given that the company is a pillar of the German economy, holds a vast amount of capital, and is important for pension payouts.

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Although the talks did not last long, the plans for possible separate offers for Allianz indicate that there is ambition among Chinese conglomerates, including Anbang and HNA, to create a global empire through large acquisitions financed by debt.

Numerous foreign transactions have resulted in increased scrutiny from Chinese regulators regarding foreign acquisitions by Chinese companies, ranging from football clubs to film studios. Acquisitions by companies such as Anbang, HNA, Fosun, and Dalian Wanda have come under the microscope.

The government in Beijing has tightened restrictions on foreign acquisitions in recent months, urging domestic banks to reduce lending, which has led to a record $221 billion in foreign acquisitions by Chinese companies last year.