JD Allianz P&C Insurance's equity change: Allianz Insurance plans to transfer 53% of its equity to a subsidiary, and JD.com's shareholding increases

Source of this article: Times Finance Author: He Xiulan

JD Allianz Property & Casualty Insurance reappeared in equity transfer during the year, and the major shareholder is about to change hands.

On April 17, JD Allianz Property Insurance issued an announcement on the change of shareholders, and on April 15, Allianz Insurance Group and Allianz (China) Insurance Holdings Co., Ltd. (hereinafter referred to as "Allianz China Holdings") signed the "Equity Transfer Agreement", stipulating that Allianz Insurance Group will transfer 53.33% of the company's equity held by it to Allianz China Holdings. After the completion of the equity transfer, Allianz China Holdings will become the largest shareholder of JD Allianz P&C Insurance, while Allianz Insurance Group will no longer directly hold the company's equity.

For this equity transfer, JD Allianz Property Insurance said to Times Finance that the company is a joint venture between Allianz Insurance Group and JD Group, and the equity transfer is a company decision, and the specific information is subject to the information published on the company's official website.

In addition to the above-mentioned equity transfer, JD Allianz P&C Insurance also had another equity transfer in March. At that time, JD Allianz Property Insurance announced that shareholders unanimously agreed that Beijing JD Sanbailu Shidu E-commerce Co., Ltd. (hereinafter referred to as "Beijing JD") acquired 3% of the equity held by Zhongyuan Xinda Intellectual Property Agency Co., Ltd. (hereinafter referred to as "Zhongyuan Xinda"). At present, the equity transfer has been approved by the regulator.

As a Sino-foreign joint venture, JD Allianz Property & Casualty Insurance Co., Ltd., despite its rich experience in insurance risk management of Allianz Insurance Group, as well as JD Group's traffic resources and Internet technology advantages, has not entered a stable profit channel for many years since its establishment, with a net profit loss of more than 17 million yuan in 2022 and a profit of more than 30 million yuan in 2023.

Major shareholders are about to change hands, and JD.com's shareholding ratio has increased

After the completion of this equity transfer, Allianz Insurance Group will withdraw from the ranks of JD Allianz P&C Insurance's shareholders, and the change of shareholders will take effect after the approval of the Guangdong Supervision Bureau of the State Financial Supervision and Administration Bureau.

At the same time, Allianz China Holdings undertakes that, in strict accordance with the relevant provisions of laws, regulations and regulatory rules, the funds to be used to purchase 53.33% of the company's equity from Allianz Insurance Group are Allianz China Holdings' own funds, and the sources are true and legitimate.

The current actual controller of JD Allianz P&C Insurance is Allianz Insurance Group, and this equity transfer is just Allianz Insurance Group's move from the front to the back. From the perspective of shareholding structure, although Allianz Insurance Group will no longer directly hold the equity of JD Allianz P&C Insurance, it is the sole shareholder and actual controller of Allianz China Holdings, so it indirectly holds 53.33% of the equity of JD Allianz P&C Insurance.

Market observers told Times Finance that Allianz Insurance Group's transformation from direct control of JD Allianz P&C Insurance to indirect control may help optimize the company's governance structure and management decisions, but it will not change its actual influence and control over JD Allianz P&C.

Allianz Insurance Group operates in more than 70 countries and regions around the world, among which its insurance-related subsidiaries in China include JD Allianz Property & Casualty Insurance, Allianz Life Insurance, Allianz Insurance Assets, etc. According to the data, in 2023, Allianz Insurance Group's total revenue increased by 5.5% to 161.7 billion euros, operating profit increased by 6.7% to 14.7 billion euros, mainly driven by life and health insurance businesses, and core net income of shareholders reached 9.1 billion euros, an increase of 30.3%.

It is worth noting that in March this year, JD Allianz Property Insurance has just been approved for another equity change.

On March 15, the Guangdong Supervision Bureau of the State Administration of Financial Supervision approved the transfer of 48.3 million shares of JD Allianz Property Insurance to Beijing JD.com. After the transfer, Beijing JD.com holds 531.3 million shares of JD Allianz P&C Insurance, with its shareholding ratio rising from 30% to 33%, while Zhongyuan Cinda holds 151.34 million shares of JD Allianz P&C Insurance, with its shareholding ratio decreasing from 12.4% to 9.4%.

JD.com's performance was unstable after entering the game, and it will turn losses into profits in 2023

JD Allianz P&C Insurance is a joint venture between JD Group and Allianz Insurance Group, one of the world's leading financial services groups, relying on JD.com's rich ecological resources, strong digital capabilities, and more than 132 years of risk management experience of Allianz Insurance Group, to provide e-commerce Internet insurance, accidental health insurance, auto insurance, etc. for corporate and individual customers.

In 2018, Allianz P&C Insurance, a veteran foreign-funded property and casualty insurance company, ushered in a key turning point. In this year, the registered capital of Allianz P&C Insurance increased from 805 million yuan to 1.61 billion yuan, the shareholding ratio of Allianz Insurance Group decreased from 100% to 50%, and four shareholders, including Beijing Jingdong and Shanghai Yingxue Investment Management Center (Limited Partnership) (hereinafter referred to as "Shanghai Yingxue Investment"), subscribed for 50% of the shares.

Among them, JD.com invested 483 million yuan, holding 30% of the shares, becoming the second largest shareholder of Allianz Property Insurance. Since then, Allianz P&C Insurance has changed its name to JD Allianz P&C Insurance. In 2022, Allianz Insurance Group acquired a 3.33% stake in JD Allianz Property Insurance held by Shanghai Yingxue Investment, and its shareholding ratio increased to 53.33%.

In recent years, Baidu, Alibaba, Tencent, JD.com and other Internet giants have entered the insurance industry, in 2015, insurance as the sixth largest business sector merged into the JD financial system, after obtaining JD insurance brokers and JD insurance agents two intermediary licenses, in 2018 after the stake in Allianz property insurance curve to obtain a traditional property insurance license. At present, JD Insurance's territory covers major insurance business areas such as property insurance, life insurance, and health insurance.

Source: JD Finance's official website

After JD Allianz P&C Insurance transformed from a foreign-funded insurance company into a Sino-foreign joint venture insurance company, its insurance business revenue increased from 1.241 billion yuan in 2018 to 5.257 billion yuan in 2022, although the scale of its insurance business expanded steadily. However, the company's earnings performance has shown ups and downs.

According to the data, from 2018 to 2022, the net profit of JD Allianz Property Insurance fluctuated greatly, achieving net profits of 32.7277 million yuan, 4.5277 million yuan, 38.5584 million yuan, 2.6411 million yuan, and -17.0389 million yuan respectively.

It is worth noting that JD Allianz P&C Insurance's premium scale will continue to rise steadily in 2023 and turn losses into profits. According to the data, in 2023, JD Allianz Property Insurance will achieve insurance business income of 5.692 billion yuan and net profit of 30.0829 million yuan respectively.

In addition, in recent years, JD Allianz P&C Insurance's comprehensive risk rating has been downgraded from A to B by the regulator. However, in the third quarter of 2023, JD Allianz P&C Insurance's latest comprehensive risk rating result was upgraded to BB, mainly due to the upgrade of the company's corporate governance rating to B, which led to the upgrade of the company's comprehensive risk rating in the third quarter.

JD Allianz Property Insurance said in the latest solvency report that after receiving the comprehensive risk rating results in the third quarter of 2023, the company's risk management and control department communicated with the Guangdong Supervision Bureau of the State Financial Supervision and Administration as soon as possible to understand the specific areas of deduction points, timely feedback on the loss of points by relevant departments, formed corresponding rectification plans with relevant departments, and promoted relevant rectifications as planned.