Mirae Asset in exclusive talks to buy Anbang’s US hotels

Mirae Asset Financial Group has entered into exclusive negotiations to acquire a portfolio of 15 US luxury hotels owned by Anbang Insurance Group, valued at $5.5 billion, in what would be the biggest cross-border real estate investment by a South Korean company.

A consortium of Mirae Asset’s units was recently named a preferred buyer of the hotels business by the Chinese insurer, beating other suitors including Brookfield Asset Management Inc. and Softbank-owned Fortress Investment Group, a source with knowledge of the matter said on August 25.

“This is a strategic deal taken care of by Mirae Asset Chairman Hyeon-joo Park himself,” the source told the Korean Investors.

Mirae plans to finalize details such as the purchase price at a board meeting this week and to sign a definitive agreement early next month.

Earlier this month, a Mirae source said that it would seek to attract outside financial investors for the acquisition once it was selected a preferred buyer.

The potential multibillion-dollar acquisition should pull its net capital ratio lower, so Mirae is putting cashable assets up for sale, MoneyToday said on August 25, citing a source close to Mirae Asset.

Other final bidders for the hotel portfolio reportedly included Singapore’s GIC and Blackstone Group which sold the properties’ owner, Strategic Hotels & Resorts Inc., to Anbang for about $5.5 billion in 2016.

The properties include the Westin St. Francis in San Francisco, the Loews Santa Monica Beach Hotel, the JW Marriott Essex House in New York and the Four Seasons in Jackson Hole, Wyoming.

Anbang is forced to sell the porforlio after Chinese authorities seized control of the Chinese insurer and later sentenced Chairman Wu Xiaohui to 18 years in prison on fraud and embezzlement charges.

Mirae Asset had invested about $1.3 billion in buying three US hotels between 2015 and 2016: Fairmont San Francisco Hotel, the Fairmont Orchid in Hawaii’s Big Island and Hyatt Regency Waikiki Beach Resort and Spa.

It has also made debt investments of $186 million in Las Vegas Cosmopolitan Hotel and  the West Hollywood Edition hotel and residences since last year.

By Hung-hwan Hwang and Hyun-il Lee

jung@hankyung.com