SHAREHOLDERS APPROVE PING AN REFINANCING PLAN

China’s second largest insurer Ping An has won the approval of its shareholders for a revised refinancing plan following the widespread concern that greeted the original proposal made back in January. Under the new arrangement, Ping An will issue 80 billion yuan worth of shares and 40 billion yuan of convertible bonds on the Shanghai stock exchange. The original January proposal had involved almost 40 billion yuan more in stock and bonds and investors’ concern that such a flood of equity could affect the liquidity within China’s stock market led to a sharp drop in Ping An’s share price. This revised proposal received the support of 90% of Chinese shareholders and 97% of Hong Kong shareholders and also saw the insurer’s share value rise following the approval of shareholders. The insurer’s chairman Ma Mingzhe told shareholders that the refinancing would “replenish capital to keep up with the rapid development of China’s financial sector” adding that the proceeds may be used to invest in more euro-based assets in order to diversify Ping An’s investment portfolio. As Ping An president Louis Cheung told the assembled shareholders: “It is not wise for Ping An to hold only yuan assets or link our growth entirely to the Chinese economy.” In November 2007 Ping An acquired a 19.2 billion yuan stake in the Belgian-based Fortis group and although the Ping An chairman added that the board was exploring further acquisition opportunities, no specific targets were mentioned.