04/07/2021

Genworth Financial, Inc. (NYSE: GNW), the provider of mortgage and long-term care insurance based in Richmond, Virginia, said Tuesday that it had exercised its right to terminate the deal with Beijing-based China Oceanwide Holdings Group Co. Ltd.

The deal was first announced in 2016, with China Oceanwide agreeing to buy Genworth for about $2.7 billion. or $5.43 per share in cash. It was originally expected to close in the following year.

The deal subsequently got tied up in years of government regulatory reviews in the United States and Canada, forcing Genworth and China Oceanwide to delay the completion of the merger 17 times. But regulatory hurdles and financing issues repeatedly delayed the marriage, which was further complicated in the last year by the global coronavirus pandemic. Terminating the deal will allow the Fortune 500 company to pursue its revised strategic plan without restrictions, Genworth said.

China Oceanwide and Genworth also will continue to explore potential opportunities to bring long-term care insurance and other similar products to the Chinese insurance market in the future.

History of Genworth Financial

1871: The Life Insurance Company of Virginia, known as Life of Virginia, was started by two dozen investors in Petersburg and offered its first policies to local customers. The company later expanded and moved its headquarters to Richmond.

1927: The company expanded its portfolio to include annuities.

1961: The company added mortgage insurance to its insurance offerings.

1967: Richmond Corp. was created to serve as a holding company for Life of Virginia and Lawyers Title Insurance Corp.

1974: The company started offering long-term care insurance policies.

1977: Richmond Corp. was sold to the Continental Group Inc. for $370 million to form the Richmond Co., later known as Continental Financial Services Co.

1984: Richmond-based Universal Leaf Tobacco Co. Inc. acquired Lawyers Title from Continental Financial Services for $115 million. Universal Corp. spun off Lawyers Title as an independent business in 1991.

1986: Combined Insurance, a holding company based in Chicago, bought Life of Virginia for $557 million and became AON Corp. the following year.

1996: GE Capital, the financial services unit of General Electric, announced plans to buy most AON Corp.’s life insurance business, including Life of Virginia. Under GE Capital, Life of Virginia became part of GE Financial Assurance Holdings Inc., before becoming GE Capital Assurance Co.

1997: GE Financial Assurance moved its headquarters from Stamford, Conn., to the Brookfield office complex in western Henrico County.

October 2003: Genworth Financial was formed by the joining of several GE Capital insurance companies.

May 2004: Genworth went public on the New York Stock Exchange in a $2.8 billion initial public offering at $19.50 per share. Michael D. Fraizer, former chairman, president, and CEO of GE Financial Assurance, becomes Genworth’s chairman, president and CEO.

2008: Genworth reports $572 million in losses for the year as the housing market collapse forces it to make huge payouts in its mortgage insurance business, while a stock market decline hurt its investments, pushing down the company’s stock price. The company laid off about 1,000 employees.

May 2012: Michael D. Fraizer resigned as chairman and CEO of Genworth. James S. Riepe named as non-executive chairman.

December 2012: Long-time insurance industry executive Thomas J. McInerney named president and CEO of Genworth.

Dec. 31, 2013: Genworth stock closed at $15.53 after doubling for the year as the company’s U.S. mortgage insurance business posted its first annual profit since 2007.

2013-2014: As the mortgage insurance business stabilized, Genworth faced losses in its long-term care insurance business. The company reported a loss of $1.2 billion for 2014 after setting aside hundreds of millions of dollars to cover long-term care insurance costs.

May 2014: Genworth raised $545 million by selling a stake in its Australian mortgage insurer.

March 2, 2015: Genworth reported a material weakness in its accounting for long-term care coverage. Shares fell 5.4% to $7.33.

April 29. 2015: McInerney said he would be open to taking Genworth private if a buyer would be willing and able to accept the risks.

Feb. 4, 2016: Genworth suspended sales of traditional life coverage and fixed annuity products after posting a fourth-quarter loss.

October 2016: Genworth agreed to be acquired by China Oceanwide Holdings Group Ltd., a privately held, family-owned international financial holding company based in Beijing, for $5.43 per share or $2.7 billion.

March 2017: Shareholders of Genworth voted to approve the company's acquisition by China Oceanwide.

2017-2020: The closing of the China Oceanwide deal was delayed multiple times as Genworth sought approval from numerous state insurance regulators and federal regulatory agencies.

June 2018: The Committee on Foreign Investment the United States, or CFIUS, cleared the proposed deal with China Oceanwide. CFIUS is a joint committee of federal government agencies that reviews acquisitions of U.S. firms by foreign entities for national security concerns. As part of its efforts to get the approval, Genworth agreed to use a U.S.-based third-party service provider to manage and protect the data of its U.S. policyholders.

August 2019: After being unable to get approval from Canadian regulators for the China Oceanwide deal, Genworth agreed to sell its Canadian mortgage insurance business to Brookfield Business Partners L.P., a Toronto-based investment firm.

Dec. 12, 2020: Genworth said China’s economic management agency - the National Development and Reform Commission, or NDRC – had re-approved the deal. Genworth and China Oceanwide extend the deadline for the deal for a 17th time until Dec. 31 to give China Oceanwide more time to conclude financing.

Jan. 4, 2021: Genworth said the merger has been put on indefinite hold, though both companies said they may still be able to complete a deal. Genworth said it is focusing on pursuing a contingency plan that could include a partial, initial public offering of stock for its U.S. mortgage insurance business.

April 6, 2021: Genworth said it has exercised its right to terminate its merger agreement with China Oceanwide, allowing the company to pursue its revised strategic plan without restrictions and without uncertainty regarding its ultimate ownership.