Henrico County-based insurance giant Genworth Financial Inc. has started notifying some of its employees that their jobs are being eliminated after the company’s planned merger with a China-based investment firm was indefinitely delayed.
A spokeswoman for Genworth, which has thousand of employees in Virginia, mainly in the Richmond and Lynchburg areas, confirmed Wednesday the company is starting to notify employees of job reductions.
The company declined to provide any specific numbers of employees affected or when the jobs will be cut.
“I can confirm that we have notified certain colleagues that their positions are being eliminated,” Genworth spokeswoman Julie Westermann said in an email in response to questions.
“This is not something we take lightly and we are committed to providing affected colleagues with the utmost care, compassion and support during this transition,” Westermann said. “Out of respect for our colleagues who are losing their jobs, we will not be providing any other details at this time.”
The job cuts come about two weeks after Genworth announced that its long-delayed planned to be acquired by China Oceanwide Holdings Group Inc. had been put on indefinite hold.
Genworth President and CEO Thomas McInerney told investors and analysts on a conference call on Jan. 5 that the company would look to cut costs after the merger deal was put on hold.
Genworth sells both long-term care insurance that covers the costs of nursing home or at-home care, and home mortgage insurance covering defaults on home loans.
China Oceanwide agreed in October 2016 to acquire Genworth for $2.7 billion, or $5.43 per share. The closing of the acquisition has since been delayed 17 times, mostly as Genworth sought approval for the deal from numerous state and federal government insurance regulators.
China Oceanwide also needed to obtain a financing package for the deal, but that financing appears now to be indefinitely delayed in part because of disruptions caused by the COVID-19 pandemic. Both companies said the merger may still be completed if China Oceanwide can come up with the financing, but the merger could also be terminated by either company at any time.
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