JD.com takes 30% stake in Allianz China General Insurance
July 31, 2018 Category China News Round-up, Weekly
Chinese e-commerce firm JD.com has received regulatory approval to buy a 30% stake in the Chinese unit of global insurance company Allianz, furthering its push into the country’s financial services sector. JD has gained approval to invest CNY483 million for a stake in Allianz China General Insurance Co, the China Banking and Insurance Regulatory Commission (CBIRC) said. Following the investment, JD will become the second-largest shareholder in the insurance firm, while Allianz will retain a 50% share in its China unit. Three other investors, China Sinda, Shenzhen Huijing Tongda and Snowlight Capital will have 12.4%, 4.27% and 3.33% stakes in the unit respectively after the transaction.
The partners said they have entered into a longterm partnership to develop a digital insurance joint venture in China. Liu Qiangdong, Founder and CEO of JD, had previously revealed the company planned to launch an internet insurance service, and move into the online brokerage business and internet banking. “The development potential of China’s insurance sector is vast, and internet heavyweights possess certain advantages moving into the burgeoning industry, as they have mastered huge customer bases, and could launch tailor-made insurance services by utilizing their big data analytics and precise algorithms,” said Li Chao, Senior Analyst at market research firm iResearch. JD’s move will also encourage traditional insurance companies to expand their online sales channels, and cooperate with more internet firms.
Chinese tech companies are stepping up efforts to tap into the booming online insurance market, including Alibaba Group Holding and Tencent Holdings. In 2013, Alibaba, Tencent and Ping An Insurance (Group) Co of China established the country’s first online insurer Zhong An Online P&C Insurance. Ant Financial Services Group, Alibaba’s financial arm, acquired a controlling 51% stake in Cathay Century Insurance Co in 2016, while Tencent holds a 20% stake in the Hong Kong unit of UK-based insurance group Aviva, and a 15% stake in China’s Hetai Life Insurance Co, the China Daily reports.
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