Why Genworth Financial, Inc. Shares Were Rocked to the Tune of a 13% Loss
Shares of Genworth Financial (NYSE: GNW), one of the largest players in long-term care insurance, shed 13% of its value during Monday's trading session after it and its potential acquirer, China Oceanwide Holdings, provided an update on its application with the Committee on Foreign Investment in the United States (CFIUS). As you can surmise by the move lower, concerns are again manifesting about whether this buyout will go through.
According to the press releases from the companies, they've withdrawn their voluntary notice with the CFIUS with "an intent to refile the transaction with additional mitigation approaches, including potentially working with a U.S. third-party service provider." The CFIUS is a regulatory agency that scrutinizes the acquisition of U.S. companies by foreign entities, and despite Genworth's shareholders approving the $2.7 billion merger back in March and China Oceanwide announcing plans to buy Genworth Financial back in October 2016, regulatory hurdles have proven thus far insurmountable for both companies.
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Source: Fool.com
