CENTRAL HUIJIN TO PAY US$594 MLN TO TAKE OVER NEW CHINA LIFE

China Central Huijin should pay 4.058 billion yuan (US$594.31 million) in a lump to buy 38.815 per cent of New China Life Insurance's shares from China Insurance Security Fund Co. Ltd., according to people familiar with the transaction.

The Ministry of Finance (MOF) and the China Insurance Regulatory Commission (CIRC) have agreed to the transaction in principal.

Whether or not the Central Huijin can pay the 4.058 billion yuan in a lump has become the key factor for the transaction's development. But analysts hold that it would not be difficult for the Central Huijin to raise 4.058 billion yuan, so the New China Life Insurance share purchase is achievable.

The Central Huijin has gained much by investing in state-owned banks and brokers; bonus and cash taking by cutting holdings are its key capital sources.

By rough estimation, the Central Huijin had earned by early 2009 over 100 billion yuan by investing in the four state-owned banks.

The Central Huijin is an investment arm of the China Investment Corporation, China's sovereign wealth fund.