Fanhua Signs Definitive Agreement To Acquire Zhongji Shi’An Insurance Agency
February 06 2023 - 5:39AM
Fanhua Inc. (“Fanhua” or the “Company”) (Nasdaq: FANH), a leading
independent financial services provider in China, today announced
that it has signed a definitive agreement (the “Agreement”) with
the existing shareholders of Jilin Zhongji Shi’An Insurance Agency
Co., Ltd (“Zhongji”), to acquire 51% of the equity interests of
Zhongji. The transaction is expected to be completed in the first
quarter of 2023, subject to certain customary conditions.
Pursuant to the Agreement, the Company will
acquire 51% of the equity interests of Zhongji with a stock
consideration of up to 683,036 American Depositary Shares. Zhongji
is estimated to generate gross written premium of approximately
RMB208 million and net income of RMB15 million in 2025,
representing a compound annual growth rate of approximately 16% and
44%, respectively, from 2023 to 2025. The stock consideration,
adjustable based on the achievement of certain performance targets
in the next three years by Zhongji, is subject to a lock-up period
of three years and will be released from lock-up in two batches
after 2025.
Zhongji is the largest insurance agency in Jilin
Province, China, which registered over RMB100 million gross written
premiums in 2022.
Mr. Yinan Hu, Chairman and CEO of Fanhua, said:
“We are glad to welcome Zhongji to join us. The acquisition allows
us to rapidly expand our market presence into Jilin Province. It
also marks another important step forward towards Fanhua’s
dedication to accelerating our Open Platform strategy. We look
forward to connecting with more small and medium-sized independent
insurance intermediary companies through mergers and acquisitions
and the MGA, or managing general agency, model, and to empowering
various stakeholders in the insurance industry with Fanhua’s
technology-driven digital platform, to drive high quality
development of the insurance intermediary sector as a whole.”
Mr. Qinying Zhang, Chairman and General Manager
of Zhongji, said: “We are excited to be part of Fanhua. Our sales
team will benefit significantly from various resources that
Fanhua’s technology-driven digital platform offers. We believe the
partnership will help strengthen our competitive edge and enhance
our operating efficiency, leading to stronger growth in our
business scale and profit in the years to come.”
About Fanhua Inc.
Fanhua Inc. is a leading independent financial
services provider. Through our online platforms and offline sales
and service network, we offer a wide variety of financial products
and services to individuals, including life and property and
casualty insurance products. We also provide insurance claims
adjusting services, such as damage assessments, surveys,
authentications and loss estimations, as well as value-added
services, such as emergency vehicle roadside assistance.
Our online platforms include: (i) Lan Zhanggui,
an all-in-one platform which allows our agents to access and
purchase for their policy holders a wide variety of insurance
products, including life insurance, auto insurance, accident
insurance, travel insurance and standard health insurance products
from multiple insurance companies on their mobile devices; (ii)
Baowang (www.baoxian.com), an online entry portal for comparing and
purchasing short term health, accident, travel and homeowner
insurance products and (iii) eHuzhu (www.ehuzhu.com), a non-profit
online mutual aid platform in China.
As of September 30, 2022, our distribution and
service network consisted of 697 sales outlets covering 23
provinces, autonomous regions and centrally-administered
municipalities and 100 service outlets covering 31 provinces.
For more information about Fanhua Inc., please
visit http://ir.fanhuaholdings.com/.
Forward-looking Statements
This press release contains statements of a
forward-looking nature. These statements, including the statements
relating to the Company’s future financial and operating results,
are made under the “safe harbor” provisions of the U.S. Private
Securities Litigation Reform Act of 1995. You can identify these
forward-looking statements by terminology such as “will,”
“expects,” “believes,” “anticipates,” “intends,” “estimates” and
similar statements. Among other things, management’s quotations
contain forward-looking statements. These forward-looking
statements involve known and unknown risks and uncertainties and
are based on current expectations, assumptions, estimates and
projections about Fanhua and the industry. Potential risks and
uncertainties include, but are not limited to, those relating to
its ability to attract and retain productive agents, especially
entrepreneurial agents, its ability to maintain existing and
develop new business relationships with insurance companies, its
ability to execute its growth strategy, its ability to adapt to the
evolving regulatory environment in the Chinese insurance industry,
its ability to compete effectively against its competitors,
quarterly variations in its operating results caused by factors
beyond its control and macroeconomic conditions in China, future
development of COVID-19 outbreak and their potential impact on the
sales of insurance products. Except as otherwise indicated, all
information provided in this press release speaks as of the date
hereof, and Fanhua undertakes no obligation to update any
forward-looking statements to reflect subsequent occurring events
or circumstances, or changes in its expectations, except as may be
required by law. Although Fanhua believes that the expectations
expressed in these forward-looking statements are reasonable, it
cannot assure you that its expectations will turn out to be
correct, and investors are cautioned that actual results may differ
materially from the anticipated results. Further information
regarding risks and uncertainties faced by Fanhua is included in
Fanhua’s filings with the U.S. Securities and Exchange Commission,
including its annual report on Form 20-F.
For more information, please contact:
Investor Relations
Tel: +86 (20) 8388-3191
Email: qiusr@Fanhuaholdings.com
Source: Fanhua Inc.
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