February 23. 2018
One of the symbols of New York luxury is now in the hands of Beijing.
The Chinese government has taken control of Anbang Insurance Group, a Beijing-based conglomerate that has aggressively acquired overseas companies and properties including the Waldorf Astoria in New York City. The move highlights the complexities the US faces as more and more Chinese companies—often with opaque ownership structures—attempt to purchase stateside companies. An ostensibly private holding can, seemingly overnight, change status.
In a statement (link in Chinese) Friday (Feb. 23), the China Insurance Regulatory Commission (CIRC) said it was acting to protect insurance product consumers because Anbang was in danger of insolvency. A government work group will control Anbang for one year, until Feb. 22, 2019. It’s not clear what will happen to the company’s ownership afterwards, though one possibility is a government-orchestrated sale of a stake in the company. The company’s board of directors and board of supervisors will step down and make way for members of the working group, and the company will continue to operate as normal, the regulator said. It added that Wu Xiaohui, Anbang’s chairman, is being prosecuted on suspicion of committing “economic crimes.”
The takeover means that the Waldorf Astoria, which Anbang purchased from Hilton Worldwide in October 2014 for $1.95 billion, is now directly under the Chinese government. The government move should also see properties under Strategic Hotel and Resorts, which Anbang purchased in 2016, come under the control of the working group. These include the JW Marriot Essex House in Manhattan and the Four Seasons Hotel in Washington DC, among others. Representatives for Anbang, the Waldorf Astoria, and Strategic Hotel and Resorts did not respond immediately to Quartz’s requests for comment.
This article was posted: Friday, February 23, 2018 at 7:55 am