Japan's Sumitomo targets insurance firm
(Xinhua)
Updated: 2004-12-16 14:04

Japan's Sumitomo Corp. planned to buy an 8 percent stake in a Chinese insurance broker to help Japanese firms buy insurance for employees and plants in China, the company said Wednesday.

The Japanese conglomerate would invest 70-80 million yuan (US$8.4-9.6 million) to buy a stake in A-One (Beijing) Insurance Brokerage Co., possibly in January, a Sumitomo spokesman said.

The deal would enable Sumitomo to help Japanese firms buy a broader range of products than it could currently offer as it was preparing to enter the Chinese insurance market independently, the spokesman said.

The move was designed to meet the increasing demand from a growing number of Japanese companies in the promising Chinese market when China further opens its industries.

China’s insurance sector has witnessed a rapid influx of foreign players in recent years, including Japan’s Tokio Marine & Nichido Fire Insurance Co. and Allianz AG of Germany.

Last week, the China Insurance Regulatory Commission said in a statement foreign life insurers were allowed to provide health and group insurances as well as pension and occupational pension fund businesses in China, starting from Dec. 11.

Geographical limitations on the establishment of foreign-funded insurance institutions in China have also been removed, and foreign companies are now allowed to hold up to a 51 percent stake in joint-venture insurance brokers.

Sumitomo announced Tuesday it had established a new wholly-owned logistics subsidiary in Shenzhen.

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