Mirae Asset Wins Lawsuit Over US Hotel Acquisition... Contract Cancellation Ruling

Deposit of 700 Billion Won and Various Expenses Now Refundable

[Asia Economy Reporter Minwoo Lee] Mirae Asset has won a lawsuit against China’s Anbang Insurance regarding the execution of a contract to acquire 15 luxury hotels in the United States. As a result, the contract has been canceled, and the deposit and various litigation-related costs can be recovered.

Mirae Asset Financial Group announced on the 1st that it received a favorable ruling in the lawsuit against China’s Anbang Insurance on the 30th (local time), resulting in the cancellation of the contract. The ruling stated that the seller, Anbang Insurance, failed to meet the contract compliance conditions and failed to secure title insurance (insurance that compensates for losses that real estate owners and mortgage holders may suffer due to defects in real estate rights), making the buyer Mirae Asset’s contract termination appropriate.

Accordingly, Mirae Asset will be able to recover all contract deposits including interest. It can also claim $3,685,000 (approximately 4.1 billion KRW) in transaction-related expenses and legal fees incurred during the trial.

Previously, in September last year, Mirae Asset signed a contract to acquire 15 hotels located at major hubs in the United States from China’s Anbang Insurance for a total of $5.8 billion (approximately 7 trillion KRW), paying a deposit of $580 million (approximately 700 billion KRW). This is the largest scale of alternative investment by a domestic financial company. The deal included the JW Marriott Essex House Hotel in New York, the Four Seasons Hotel in Jackson Hole, Wyoming, the Westin St. Francis in San Francisco, and the Loews Santa Monica Beach Hotel. The transaction was scheduled to close on April 17, but Mirae Asset discovered in February that Anbang Insurance was involved in litigation concerning these hotels.

The Anbang court had already been sued regarding the ownership of the 15 hotels subject to this transaction. Although Anbang Insurance responded to the lawsuit in December last year, it did not disclose this fact to Mirae Asset. For the same reason, four insurance companies, including Fidelity National, the largest title insurer in the United States, refused to issue full title insurance for all 15 hotels subject to the sale.

Accordingly, Mirae Asset sent a notice of default because Anbang Insurance failed to meet the condition precedent for closing the transaction by concealing ownership disputes. When Anbang Insurance failed to resolve the contract violations within 15 days, Mirae Asset notified the contract termination on May 3. Anbang Insurance refused to accept the termination and filed a lawsuit against Mirae Asset in the Delaware Court of Chancery on April 27.

This content was produced with the assistance of AI translation services.