Thomas McInerney, president and chief executive officer of Genworth Financial Inc., listens to a question during a Bloomberg Television interview in New York, U.S., on Friday, June 27, 2014. Thomas McInerney (Photo: Victor J. Blue/BB)

Genworth Financial Inc. says China Oceanwide Holdings Group Co. Ltd. of Beijing is having trouble nailing down the financing it needs to pay to acquire Genworth.

China Oceanwide — a financial services and real estate development company based in Beijing — has been trying to acquire Genworth for about four years. The company is in the process of closing on a $1.8 billion financing arrangement from Hony Capital, a big, Hong Kong-based private equity firm.

“Oceanwide has indicated that the financing has been delayed due to the COVID-19 pandemic and uncertain macroeconomic conditions,” Genworth said in a comment included in the financing delay announcement.

(Related: Genworth Aims to Line Up Backup Financing Options)

China Oceanwide has major developments in the center of Wuhan, which was hit especially hard by the COVID-19 outbreak.

Genworth and China Oceanwide said they will push the deal completion deadline back to Sept. 30, from June 30.

The extension is the 15th the companies have announced.

Genworth is a Richmond, Virginia-based company that is a large player in the mortgage insurance markets in the United States and Australia.

It sells some stand-alone long-term care insurance (LTCI), and it has been a major player in the life, annuity and LTCI markets.

The company has $1 billion in debt coming due in 2021 and potential liabilities related to litigation with AXA.

Because of the delay in the China Oceanwide deal closing, Genworth is preparing to handle the payments by borrowing money, and, possibly, by selling a 19.9% stake in the U.S. mortgage insurance business to the public, through an initial public offering, Genworth said.

The new deal extension calls for China Oceanwide to show Genworth, by Aug. 31, that China Oceanwide has $1 billion in funding from sources in China to pay for the deal, and $1 billion in financing from Hony Capital or other sources.

“If these conditions are met, the merger agreement will remain in place until Sept. 30, 2020. If the conditions are not met, Genworth has the right, in its sole discretion, to terminate the merger agreement as of Aug. 31, 2020,” according to the extension announcement.

Thomas McInerney, Genworth’s chief executive officer, said in a comment on the deal extension that the company heard stakeholders would like greater assurance that the China Oceanwide deal is moving toward closing.

The financing confirmation provision should address that concern, McInerney said.

“We continue to believe the transaction represents the best and most certain value for Genworth’s shareholders,” McInerney said.

Lu Zhiqiang, the chairman of China Oceanwide, said in a comment of his own that he’s still committed to the deal.

“We have overcome many hurdles during the past three and half years and continue to persevere because of the future value of Genworth to our vision of pursuing the significant opportunities for long term care (LTC) insurance in the U.S., China and the rest of Asia,” Lu said. “We remain committed to securing financing for the transaction in order to close the transaction as soon as possible.”

Correction: An earlier version of this article described Genworth’s mortgage insurance business incorrectly. It has operations in Australia.

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