Genworth to Sell Genworth MI Canada Stake to Brookfield Business Partners -- Update

Date : 08/13/2019 @ 1:12PM
Source : Dow Jones News
Stock : Genworth Financial Inc (GNW)
Quote : 4.31  0.0 (0.00%) @ 11:00PM

Genworth to Sell Genworth MI Canada Stake to Brookfield Business Partners -- Update

Genworth Financial (NYSE:GNW)
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By Colin Kellaher

 

Genworth Financial Inc. (GNW) agreed to sell its roughly 56.9% stake in Genworth MI Canada Inc. (MIC.T) to Brookfield Business Partners L.P. (BBU, BBU.UN.T) for about $1.8 billion in a bid to gain regulatory clearance for the acquisition of Genworth by Chinese investment firm China Oceanwide Holdings Group Co. (0715.HK).

Genworth on Tuesday said it would sell the Genworth MI stake at C$48.86 a share, a 4.1% discount to Monday's closing price of C$50.95.

China Oceanwide in late 2016 agreed to pay about $2.7 billion for Genworth, a dominant carrier in U.S. long-term-care insurance. But the takeover has been delayed in part by Canadian regulatory concerns over the fate of Genworth MI, the largest private-sector residential mortgage insurer in Canada.

Genworth said China Oceanwide has consented to the Genworth MI sale, and that the companies have agreed to extend their merger agreement to Dec. 31.

Brookfield, the business-services and industrials arm of Brookfield Asset Management Inc. (BAM), said it will fund about $700 million of the purchase at closing, with some of its institutional partners co-investing for the balance.

The companies said Brookfield has agreed to provide Genworth with up to $850 million in bridge financing if regulatory approvals for the Genworth MI deal aren't in hand by Oct. 31.

Brookfield said it plans to fund the transaction, including the bridge loan to Genworth, from existing liquidity.

Shares of Genworth, which closed Monday at $3.85, rose more than 15% in premarket trading Tuesday.

 

Write to Colin Kellaher at colin.kellaher@wsj.com

 

(END) Dow Jones Newswires

August 13, 2019 07:57 ET (11:57 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.

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