China's Anbang Insurance has hit a snag in its planned $1.7 billion purchase of Fidelity & Guaranty Life (FGL) , which would be its first takeover of a U.S. insurer.
The acquisitive company has withdrawn an application for clearance of the November deal from New York's Financial Services Department, the Des Moines, Iowa target said yesterday in a regulatory filing.
"The withdrawal of the NY Application was made without prejudice to Anbang's ability to refile the NY Application and after discussion with the New York Department of Financial Services," said Fidelity. "The company expects that Anbang and its subsidiaries will refile the NY application in the near future."
The target said Anbang is still also working to secure clearance from the Iowa Insurance division. The partners "are committed to securing the remaining regulatory approvals and seek to close the merger as expeditiously as possible," it said, while admitting that closing the deal hinges on regulators.
The companies originally said they expected their deal to close by the end of June.
Anbang has been chasing assets worldwide, most notably outside the insurance sector.
In late March Anbang and partners J.C. Flowers and Primavera Capital walked away from a bidding war for Starwood Hotels & Resorts (HOT) that they themselves had initiated.
A Caixin news report about its retreat from Starwood suggested the China Insurance Regulatory Commission was behind Anbang's sudden about-turn.
Fidelity & Guaranty Life closed on Tuesday down 3.3% at $23.75. That's 11% less than the $26.80 per share in cash that Anbang in November agreed to pay for the business.