Re-emergence of insurance funds' "shareholding"! Lian Life Insurance plans to acquire a 5% stake in Zhongshan Public at nearly a 10% premium, increasing its shareholding ratio to 8.12%.

On the evening of April 2, Zhongshan Public Utilities announced that its controlling shareholder, Zhongshan Investment Holding Group Co., Ltd. (hereinafter referred to as “Zhongshan Investment Holding”), and Liaan Life Insurance Co., Ltd. (hereinafter referred to as “Liaan Life Insurance”) signed a “Share Transfer Agreement” on April 1. Zhongshan Investment Holding plans to transfer approximately 73.7556 million shares it holds in the company at a price of 12.19 yuan per share (representing 5% of the company’s total share capital as of now), with total transfer proceeds of approximately 899 million yuan.

According to the announcement, after this change in rights and interests, Zhongshan Investment Holding’s shareholding ratio will drop to 43.73%, and it will remain the controlling shareholder. Liaan Life Insurance’s shareholding ratio will increase to 8.12%, making it a shareholder holding more than 5%. This agreement-based transfer does not trigger a tender offer, does not constitute a related-party transaction, will not result in any change in the company’s controlling shareholder or actual controller, and will not affect the company’s corporate governance structure and ongoing operations. At the same time, there is also no situation in which the interests of the company and its minority investors are harmed. However, it still requires approval from the state-owned assets regulatory authority and review by the Shenzhen Stock Exchange before it can be implemented.

The announcement shows that Zhongshan Investment Holding plans to transfer approximately 73.7556 million shares it holds in the company via an open solicitation transfer method, accounting for 5% of the company’s total share capital as of now. After Zhongshan Investment Holding’s comprehensive evaluation, Liaan Life Insurance was determined to be the final transferee.

According to the announcement, Zhongshan Investment Holding will transfer approximately 73.7556 million shares of unrestricted tradable shares it holds in the company to Liaan Life Insurance at a price of 12.19 yuan per share under the Share Transfer Agreement. As of April 2, the above shares have not yet completed the transfer procedures. The transfer price of 12.19 yuan per share, compared with the closing price of 11.12 yuan per share on the signing date of Zhongshan Public Utilities’ “Share Transfer Agreement” (April 1), represents a premium of about 9.62%.

The announcement discloses that Liaan Life Insurance was established on July 14, 2011, and is held 22.7857% by Jiangsu International Trust Co., Ltd. According to the announcement, in 2024, Liaan Life Insurance’s audited operating revenue was 29.77B yuan, with net profit of 47.65 million yuan. In 2025, its unaudited operating revenue was 31.73B yuan, with net profit of 185 million yuan.

In its announcement, Zhongshan Public Utilities mentioned that, to be beneficial to the company’s continued and stable development, the transferee has committed that within 12 months after the completion of the share transfer under this agreement, it will not reduce the shares it receives. Meanwhile, to optimize the governance structure of the listed company and leverage the advantages of insurance long-term value investment shareholders, after the completion of this share transfer, the transferee intends to appoint one non-independent director to the company.

Regarding the impact of this equity transfer on the listed company, Zhongshan Public Utilities stated that if it is completed smoothly, it will promote adjustments to the company’s equity structure and enhance the company’s core competitiveness. This agreement-based transfer does not trigger a tender offer, does not constitute a related-party transaction. This change in rights and interests will not lead to any changes in the controlling shareholder or actual controller of the listed company, will not have a major impact on the company’s ongoing operations, and there is no situation that damages the interests of the listed company or other shareholders.

Zhongshan Public Utilities also disclosed that this agreement-based transfer of shares still needs to obtain approval from the state-owned assets supervision and administration authorities and other relevant government departments, as well as pass compliance reviews by the Shenzhen Stock Exchange, before the transfer registration procedures can be handled with the Shenzhen Branch of China Securities Depository and Clearing Co., Ltd. Whether it can subsequently obtain approval from the relevant state-owned assets supervision and administration authorities and whether the implementation of this open solicitation transfer can be completed are both subject to uncertainty.

A reporter from The Daily Economic News noted that in recent years, Liaan Life Insurance has frequently taken actions in both the A-share and Hong Kong stock markets. From 2024 to 2025, Liaan Life Insurance successively increased its holdings in Jiangnan Water Affairs and Shenzhen International, and it also holds stocks such as Wuxi Bank and Changshu Bank. Liaan Life Insurance’s preference in shareholding is clear—it favors sectors such as public utilities, transportation, and urban commercial banks.

However, it should be noted that although Zhongshan Public Utilities’ total market value is currently only around 16 billion yuan, the largest part of its asset layout is its “hidden asset,” which is the equity stake it holds in GF Securities. According to GF Securities’ 2025 annual report, as of the end of 2025, Zhongshan Public Utilities held 687 million shares of GF Securities, accounting for 9.03% of GF Securities’ total share capital. Based on the closing price of GF Securities on April 2 of 17.99 yuan per share, the market value of the GF Securities shares held by Zhongshan Public Utilities is currently 12.36B yuan.

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(Responsible editor: Liu Sijia)

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