Genworth reported that it and China Oceanwide have withdrawn and refiled the voluntary notice they sent to the Committee on Foreign Investment in the United States. The move should extend the committee's review period by at least 30 days, and possibly by 75 days.
Refiling the notice will give the committee more time to consider the China Oceanwide-Genworth deal, Genworth said.
(Related: China's Insurers Don't Know Their Own Risks)
Originally, China Oceanwide had hoped to complete the acquisition by Aug. 31.
Genworth said it and China Oceanwide are discussing the possibility of extending the deadline and "will make a final decision regarding the deadline in coming weeks."
The companies "remain committed to satisfying the closing conditions under the merger agreement as soon as possible," Genworth said.
Genworth is a large, Richmond, Virginia-based player in the mortgage insurance market. It has a large closed block of annuity business. In the past, the company was a major issuer of long-term care insurance. It's still selling some new long-term care insurance business, and it has billions of dollars of in-force long-term care insurance business on its books.
Low interest rates, inaccurate assumptions about policyholder behavior and tight restrictions on rate increases have hit Genworth and other issuers of stand-alone long-term care insurance hard in recent years.
Genworth's announcement of the deal delay includes a statement from Lu Zhiqiang, the chairman of China Oceanwide, which is based in Beijing.
"We are working with Genworth complete this transaction, so that we can strengthen Genworth's financial position and the viability of its long-term care business in the U.S. as well as bring Genworth's expertise in long-term care insurance to our country for the benefit of our aging population."
Tom McInerney, Genworth president, said the Genworth board believes completing the deal is the best option for shareholders and policyholders, and will help Genworth be a stronger competitor in the U.S. long-term care insurance industry.
In related news, Delaware Insurance Commissioner Trinidad Navarro announced earlier this week that the Delaware Department of Insurance is still reviewing China Oceanwide's application to acquire control of a big, Delaware-based Genworth subsidiary, Genworth Life Insurance Company.
The Delaware normally does not comment on acquisition applications at all, department officials said.
"However, the proposed acquisition of [Genworth Life Insurance Company] by China Oceanwide has, understandably, generated much national and international interest, and occasioned many requests for comment by the department," officials said.
Because of the interest, Navarro provided a statement describing the process the Delaware department uses to review deal applications and organize public hearings on the applications.
The Delaware department is working with China Oceanwide and Genworth to complete a review of their proposed deal, Navarro said in a statement.
"The department cannot comment on the timing of any possible public hearing," Navarro said. "No inferences should be drawn regarding the stage of the process other than it will proceed in accordance with the process and law described."
Officials noted that Delaware needs to give the public notices of hearings at least 20 days in advance. That means the earliest regulators could hold a hearing in Delaware may be Aug. 7.
The China Insurance Regulatory Commission has been tightening the rules governing China's insurers in recent months, in response to concerns about pricing and reserving at some new insurers. China has also put new restrictions on individuals' and companies' investments outside China.
China Oceanwide appears to continue to have the ability to make investments outside China. In June, for example, the company spent $32.5 million to buy retail property in San Francisco.
Delaware regulators have posted a collection of documents associated with the Genworth Life Insurance Company acquisition application in a public Dropbox folder linked to a hearing date item on a public information page. The hearing date item has showed for months that the scheduled hearing date is "redacted." The most recent documents in the Dropbox folder appear to have been saved into the folder in January.
--- Read Anbang's Fall Closes Wild Chapter in China's Insurance Industry on ThinkAdvisor.