Chang ‘an Insurance’s 16.67% stake in Huiyou Mutual was auctioned for debt repayment, but no one bid was auctioned off.

(Photo source: Visual China)

Blue Whale News, February 14 (Reporter Shi Yu)At 10 o’clock today, the auction of the 16.67% equity interest of Huiyou Property Mutual Insurance Co., Ltd.(hereinafter referred to as Huiyou Mutual) ended. In the end, no bid was made and the auction ended.

(Photo source: Judicial Auction Platform)

Huiyou Mutual’s equity is held by Chang ‘an Liability Insurance Co., Ltd.(hereinafter referred to as Chang’ an Insurance). In May 2023, due to a dispute over the guarantee insurance contract between Chang ‘an Insurance and Hangzhou Jininvestment Bank Network Microfinance Co., Ltd., the two parties held a hearing in the Hangzhou City Intermediate People’s Court.

According to the judgment, due to Chang ‘an Insurance’s failure to fulfill its obligations specified in the legal document, the obligee Jinying Investment Bank applied for enforcement. The court filed a case for enforcement in accordance with the law on June 3, 2024. The execution target was 418.5 million yuan and debt interest, and the execution fee was 484,000 yuan. As a result, the court ruled to seal up, freeze, detain, allocate and withdraw 419 million yuan of Chang ‘an Insurance, as well as debt interest or other property of corresponding value, the person subject to execution.

Huiyou Mutual’s 16.67% equity is one of the assets frozen and auctioned to pay off debts.

The auction is marked as one auction, but it has been half a year since it first disclosed the auction information. As early as August 23, 2024, the equity was put on the Alibaba Judicial Auction Platform. At that time, the starting price was set at 74.137 million yuan, which was 30% off the evaluation price of 106 million yuan. It is scheduled to start on September 23, 2024. However, the earlier auction plan did not take shape, but the evaluation company supplemented the evaluation, re-issued the evaluation report and withdrew it.

When the auction of Huiyou Mutual’s 16.67% stake was restarted, the evaluation price displayed was adjusted to 146.5 million yuan, and the starting price was set at 104 million yuan. Compared with last year’s evaluation price, the price increased by nearly 40%.

The difference between the two evaluation results is mainly due to the different evaluation methods. It is understood that the initial evaluation is to evaluate the equity based on the transaction case comparison method in the market method. However, Huiyou Mutual is a mutual insurance company, and its equity structure is different from that of general insurance institutions. The second evaluation is determined based on Huiyou Mutual’s initial working capital contribution agreement.

After re-evaluation, and the starting price is still set at 70% of the evaluation price, Huiyou Mutual’s equity interest still ends in a non-auction.

In recent years, small-scale equity auctions of insurance companies have gradually become the norm. Behind this is the slowdown in industry growth in recent years, the joint impact of supervision on strict shareholder qualification reviews and the decline in liquidity in the equity trading market.

From the perspective of the target itself, Huiyou Mutual, established in 2017, is mainly engaged in liability insurance, credit guarantee insurance, enterprise/household property insurance and engineering insurance in the residential construction and engineering fields. Weifang Xiashan Zhongjun Innovation Industry Development Co., Ltd. and Chang ‘an Insurance hold 83.33% and 16.67% respectively.

In terms of premiums, Huiyou Mutual’s insurance business income will increase year by year from 2017 to 2021, but it will decline year-on-year in both 2022 and 2023. In this regard, Huiyou said to each other that in 2022, due to the significant impact of the epidemic on the start of the construction industry and the construction progress of projects under construction, and its own focus on operating insurance business in the field of housing construction projects, premiums will decline. 2023 will be affected by the economic downturn and risk exposure in the real estate industry. In 2024, Huiyou Mutual achieved premium income of 190 million yuan, a year-on-year increase of nearly 50%.

Profits have also fluctuated simultaneously. After losing money in the first three years, Huiyou has crossed the profit threshold in 2020 and increased to 20 million yuan in 2021. During the period, there have been fluctuations. The net profit in 2024 will be 12 million yuan, an increase from the previous year. About 9%.

What deserves special attention is the personnel level. In August 2022, Huiyou Mutual announced that it had received a written resignation report submitted by Liu Kun and no longer served as Huiyou Mutual’s director, member representative, general manager, compliance leader, chief risk officer, etc. At the same time, Huiyou appointed each other’s deputy general manager Wang Ying as the interim person in charge and interim compliance person to act as the general manager. In the past two and a half years, there has been no news of the new general manager taking up his post.

The industry has proposed that there are currently not many professional management talents focusing on insurance in the field of housing construction, and it is not easy for Huiyou to recruit general managers and senior management teams from each other if they are able to perform their duties under the framework of the mutual insurance system. Judging from the latest personnel developments, in October 2024, Huiyou introduced Yin Shulong to each other as deputy general manager and executive committee member. He once served for Ping An Bank.