By staff reporter Yu Ning 

(Caijing.com.cn)Central Huijin Investment Ltd., an arm of sovereign wealth fund China Investment Corp, will buy a 38 percent stake in New China Life Insurance Co. from the China Insurance Regulatory Commission (CIRC).

A person close to shareholders of New China Life, China’s fifth-largest insurer, told Caijing that the acquisition was approved by the State Council, China’s cabinet. The person added that the acquisition price will be set after Pricewaterhouse Coopers finishes its audit of New China Life’s 2008 accounts.  

Central Huijin is a controlling shareholder in several Chinese financial institutions and is often called upon to restructure those in poor shape. The CIRC took 38 percent in New China Life following a 2007 investigation into alleged fund misuse at the insurer. It paid 2.7 billion yuan, or 5.99 yuan per share for its stake in the unlisted company.

Ping An Insurance and the People’s Insurance Company of China, among others, have sought to buy the stake, but New China Life shareholders rejected their bids. 

Zurich Insurance Co. owns a 20 percent stake in New China Life, and steelmaker Baosteel Group holds another 17 percent. The World Bank's International Finance Corp. and Japan's Meiji Life Insurance Co. hold a combined 5 percent. 

Under Chinese law, no single investor can own more than 20 percent of an insurance company. 

New China Life reported 2008 premium income of 55.7 billion yuan. 

Full Article in Chinese: http://www.caijing.com.cn/2009-03-30/110129725.html