CP Group denies Thaksin role in Ping An acquisition

Corporate December 26, 2012 00:00

By The Nation

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Charoen Pokphand Group has flatly denied news reports that fugitive former prime minister Thaksin Shinawatra partially financed the acquisition of Ping An Insurance, China's second-largest insurer.

"The Charoen Pokphand Group would like to officially clarify as follows: The acquisition of shares were legal – the source of capital is transparent," the group said in a statement yesterday.

On December 5, All Gain Trading, Bloom Fortune Group, Business Fortune Holdings and Easy Boom Developments signed an agreement to transfer shares of Ping An Insurance from the seller HSBC Insurance Holdings and the Hong Kong and Shanghai Banking Corporation. The deal raised eyebrows as it was valued at US$9.4 billion or 73.32 billion Hong Kong dollars (Bt288 billion).

"All four companies are subsidiaries of CP which CP fully owns," CP Group insisted. "Furthermore, this acquisition was conducted with legal capital from the Charoen Pokphand Group and its subsidiaries."

It also said that since the People’s Republic of China opened up its economy in 1979, CP had cooperated well with its government. CP was the first foreign entity to invest in China and throughout the years, CP had upheld Beijing’s three agricultural-development policies as well as the "Three Benefits Principle" (benefit to the country, benefit to the people and benefit to the company).

In addition, CP said, it had continually reformed agricultural management such as expanding farmland, setting strict standards and modernising agriculture.

It said it was confident in the development of Ping An Insurance and aimed to collaborate with the company to develop every sector in the rural area, in line with the policy of modernising China’s agricultural sector.

It was reported by Chinese media this week that Thaksin might have taken part in the acquisition of Ping An Insurance.

Caixin Media’s Century Weekly magazine reported, quoting sources, that about a third of the HK$15.2-billion (Bt60-billion) first tranche of the purchase was funded by the Shinawatra family, while the rest came from businessman Xiao Jianhua.

Xiao is the founder of several banking and securities firms and has also invested in some. He is reportedly close to former top Chinese government leaders and securities watchdog officials. Century Weekly said his purchase of the Ping An stake was funded by three commercial banks he has links to.

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