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October 28, 2022

China’s Fosun weighs options for stake in Peak Re

Chinese conglomerate Fosun International is considering options for its stake in reinsurance company Peak Re to repay debts, Bloomberg reported, citing sources. 

The Shanghai-headquartered firm is in talks with financial advisers as it weighs its options including the potential divesture of a majority stake or minority shareholding in the reinsurer. 

The sale could value Hong Kong-based Peak Re between $500m and $1bn, the sources told the publication. 

Potential buyers including private equity firms have reportedly shown interest in buying Fosun’s stake, they said. 

The private discussions are at an early stage and there is no certainty that Fosun would proceed with the share sale, they added. 

Responding to a Bloomberg News query, a Fosun representative, without giving specific details about Peak Re, said that the group regularly evaluates options for its businesses.

Earlier this week, Fosun told analysts that it is looking to divest assets worth as much as $11bn within the next 12 months. 

Sources privy to the discussion have said that it is also reviewing its stake in financial institutions in Europe as part of its efforts to raise cash and repay debt.

As per the reinsurer’s 2021 annual results, Fosun and US-based insurance firm Prudential Financial hold approximately 87% and 13% in Peak Re via Peak Reinsurance Holdings, respectively.

According to Peak Re’s website, the reinsurer operates in property & casualty and life & health insurance space.  

With some $2.1bn in gross written premiums as of the end of 2021, Peak Re claims to cater to more than 580 clients in 60 markets across Asia Pacific, Europe, the Middle East and Africa, and the Americas.

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