(Yicai Global) May 9 -- Chinese electric vehicle titan BYD has been given the greenlight to acquire a 100 percent stake in bankrupt Yi’an Property and Casualty Insurance, making it the first automaker to own an insurance firm in China.

The one billion shares held in Yi’an P&C Insurance by the seven original shareholders, which include software developer Shenzhen Infogem Technologies, will be transferred to unit BYD Auto Industry, the China Banking and Insurance Regulatory Commission said today.

Although no price was given, rumors were swirling back in January that BYD might bail out Yi’an P&C Insurance with an offer of CNY3.6 billion (USD519.8 million).

Yi’an P&C Insurance was taken over by regulators in July 2020 after two straight years of losses due to mismanagement. The Shenzhen-based firm filed for bankruptcy in July last year, becoming the first insurer in China to go bust.

Yi’an P&C Insurance logged losses of CNY166.6 million (USD24.1 million) in 2019, a narrowing of 16 percent from the year before, while revenue dipped 3 percent to CNY1.1 billion (USD158.8 million), according to the last earnings report published by the insurer.

This is not BYD’s first foray into the insurance sector. In March last year the Shenzhen-based carmaker set up an insurance brokerage, with registered capital of CNY50 million (USD7.2 million), under BYD Auto Industry.

Editor: Kim Taylor