Shares in insurer rocket after deal

(Shanghai Daily)
Updated: 2007-06-22 09:17

Shares of China Life Insurance Co surged by close to their 10 percent daily limit in Shanghai yesterday after its asset management affiliate struck a partnership to invest in the country's property market.

The yuan-backed shares of China Life soared 8.25 percent yesterday to 43.42 yuan (US$5.70) in Shanghai while its Hong Kong-traded stock climbed 6.34 percent to HK$28.50 (US$3.65).

China Life Asset Management Co, which oversees the Beijing-based insurer's investments, said on Wednesday it formed a partnership with United States private equity firm Aetos Capital LLC to evaluate investment opportunities in China's real estate market. The partnership "will consider a wide range of asset types including office, residential, industrial, retail, hotel and mixed-use properties," the companies said in a release.

China Life will offer consultant services to Aetos in the tie-up.

Insurers are now banned from investing in the property sector. China Life may eye the team-up as the first step for future expansion in the sector once regulatory limits are lifted.

The Chinese regulator is expanding the investment vehicles for insurers from bank deposits, bonds to the stock and infrastructure market.

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