China's Anbang Insurance Files Suit Against Mirae Asset
Mirae Asset Global Investments announced on May 4 that it sent a contract termination notice to Anbang Insurance on May 3, 2020 regarding the purchase of 15 U.S. hotels from the Chinese insurance company and at the same time requested the escrow agent to return the down payment. Mirae Asset Global Investments signed the US$5.8 billion contract with Anbang Insurance in September 2019.
Anbang Insurance expected to close the deal on April 17, 2020, but Mirae Asset Global Investments claimed that it has found some of the preconditions for wrapping up the deal remained unfulfilled, which it said constituted the seller's violation of the contract.
Mirae Asset Global Investments pointed out that the seller failed to disclose various burdens and liabilities that undermine the hotels’ value in a timely manner, and therefore cannot escape responsibility. It further said that Anbang Insurance failed to operate the hotels normally, which was one of the contractual requirements.
On April 17, 2020, Mirae Asset Global Investments notified the seller that it will be entitled to terminate the contract if the seller fails to address the unfulfilled preconditions for closing the contract within 15 days.
After the notice, Mirae Asset Global Investments expected the seller to address the matter for 15 days according to the contract, but the period ended on May 2, 2020, without any actual explanation from the seller. Consequently, Mirae Asset Global Investments exercised the right to terminate the contract.
In the meantime, Mirae Asset Global Investments said that it is hoping to resolve the issue smoothly, adding, however, that as the seller has already filed a lawsuit, it will respond based on its legal rights.