CHINA PACIFIC SEES MORE THAN 50% SURGE ON OPENING DAY

The share price of China-based China Pacific Insurance (Group) Co rose by 73% on its opening day of trading on the Shanghai stock exchange last week, before settling back to close up 61% from the opening price of 30 yuan a share, at 48.17 yuan. China Pacific raised the equivalent of US$4.1bn through the sale of 13% of its expanded capital base. China Pacific is the third insurer in China to list on the Shanghai exchange, following in the footsteps of Ping An and China Life, both of which also saw their share price rise significantly on their opening day of trading. China Pacific Group controls the country’s third-largest life assurer and its second-largest p/c insurer, with a 9.5% share of the life market and an 11.6% share in non-life. It generated about two-thirds of its revenue from life sales in the first half of 2007. The share price means a healthy paper return for US private equity group Carlyle, which bought 1.33bn shares in May for just 4.27 yuan apiece. However, Parallel Investors Holdings, the Carlyle unit that made the purchase, has promised to hold onto the shares until at least May 2010. China Pacific is expected to list a further 900m shares on the Hong Kong bourse before the end of 2008 at “no less” than 30 yuan a share, raising at least a further $3.7bn and bringing the total capital injection to some $7.8bn.