China Life group cashes part of holdings in CITIC Securities

BEIJING, Jul 01, 2008 (Xinhua via COMTEX) -- LFC | Quote | Chart | News | PowerRating -- China Life Insurance Group, the parent of China Life Insurance (601628.SH; 2628.HK; LFC.NYSE) had sold 22,815,710 A shares of CITIC Securities (600030.SH) by June 27, according to CITIC Securities announcement Tuesday.

The deal will earn 5.866 billion yuan for China Life group, 4. 21 times the initial investment.

An analyst deems that the profit-taking move is for coloring the group's half-year report.

After the sale, the group still has 329,759,132 shares of CITIC Securities in hands, accounting for 4.97339 percent of the broker's total shares.

With a stake under 5 percent, China Life group could conduct further selling without informing other investors as ruled by law.

China Life group subscribed 150 million shares of CITIC Securities at 9.29 yuan per share during the latter's directional placement in June 2006, increasing its holding to 5.32 percent. The holding doubled to 300 million shares after the broker offered 10-for- 10 conversion of capital surplus into shares in 2007.

Meanwhile, its listed unit China Life Insurance Co., Ltd. also bought 350 million shares during the directional placement in 2006, so that its yield is estimated 133 percent more than that of its parent.

China Life A share slumped by 6.94 percent Tuesday to end at 22.26 yuan.

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