What’s going on with GNW?
Genworth Financial, Inc. (GNW) stock was trading 5.56% lower after the company’s announcement that it would terminate its merger deal with China Oceanwide Holdings Group Co., Ltd. Shares were at $3.32, lower by $0.19 per share, as of Wednesday afternoon.
What does this mean for Genworth Financial?
GNW share price dropped as investors were leery of the mortgage insurance company’s decision to terminate the merger agreement with Oceanwide. This delays the company's Chinese market entry, yet it said that it would allow it to “pursue its revised strategic plan without restrictions and without uncertainty regarding its ultimate ownership,” according to a company statement.
That plan includes a potential IPO of the company’s U.S. mortgage insurance business. Genworth over the past several years has sold interest in its Australian and Canadian mortgage business, in line with efforts to strengthen its financial position.
Genworth left open the door to explore future opportunities with China Oceanwide to bring insurance and other products to the Chinese insurance market.
"Genworth's Board of Directors has concluded that Oceanwide will be unable to close the proposed transaction within a reasonable time frame and that greater clarity about Genworth's future is needed now in order for the company to execute its plans to maximize shareholder value,” said James Riepe, non-executive chairman of the Genworth Board of Directors. “Thus, the board decided to terminate the Oceanwide merger agreement.”
GNW has an Overall Score of 7. Find out what this means to you and get the rest of the rankings on GNW!
Genworth Financial is a diversified insurance holding company that provides various mortgage and life insurance products. The company has four main operating business segments: U.S. mortgage insurance; Australia mortgage insurance; U.S. life insurance, and Runoff. The company's product portfolio includes various financial products such as traditional life insurance, mortgage insurance, fixed annuities, and variable annuities. The vast majority of revenue is generated by the company's U.S. life insurance segment that offers long-term care insurance, fixed annuity, and traditional life insurance products. The company earns most of its revenue in the United States.
