The Carlyle Group is reportedly looking to augment its Asian insurance industry holdings with a deal estimated to be worth more than $2 billion. The global buyout firm – along with Bain Capital, MBK Partners and Primus Financial – is a second-round bidder for AIG’s Taiwanese insurance unit, Nan Shan Life Insurance, sources told Reuters.
Carlyle currently owns a 17 percent stake in Shanghai-headquartered China Pacific Insurance.
This time around, Carlyle is reportedly in talks with Fubon Financial, a Taiwanese financial services major, to make a joint bid for Nan Shan. Bain Capital, on the other hand, is seeking to make a joint bid with Chinatrust Financial, another Taiwanese financial conglomerate, according to various media reports.
There is increased emphasis on roping in local partners and forming consortiums for the deal as the Taiwanese government is reluctant to let a private equity firm bid for Nan Shan assets on its own. The country’s regulators want to prevent any bidder from making a quick profit on the deal and are seeking a long-term commitment to the Taiwan market, according to the report.
“We will try to understand whether the potential majority shareholders have the capability to run Nan Shan,” Wu Chung-chuan, deputy director general of the insurance bureau, told Reuters.
Carlyle closed its fourth Asian growth fund on $1.04 billion recently and is currently raising its third Asia-focused buyout fund, which initially went to market with a reported target of $4 billion. The firm originally acquired a 24 percent stake in China Pacific Life Insurance, a subsidiary of China Pacific Insurance, in December 2005. It made an additional investment in China Pacific Life Insurance, subsequently exchanging its stake in the subsidiary for one in the parent company.
Carlyle, Bain and North Asia-focused MBK Partners, which closed its second buyout fund on $1.5 billion earlier this month, did not respond to a request for comment.
Hong Kong-based Primus Financial, which was established in April with initial permanent capital of $1 billion, declined to comment.
Taiwan’s Financial Supervisory Commission could not be reached.