7 June 2016, China Pacific Property Insurance Co., Ltd. (CPPIC), a subsidiary of China Pacific Insurance (Group) Co., Ltd. (CPIC), signed transaction documents with Baidu Penghuan Asset Management (Beijing) Co., Ltd. to establish a joint stock property insurance company (New Company). The deal is a major strategic move taken by both CPPIC and Baidu in the Internet finance industry, and will have a significant impact on the development of China’s insurance industry.

CPPIC is a top three comprehensive property insurance company in China, while Baidu is one of the world’s largest search engines, with industry-leading big data processing capability. The New Company will focus on the auto insurance business. Combining CPPIC’s actuary pricing capability and offline network service resources with Baidu’s expertise in big data modeling and in-depth machine learning, the New Company will build its core competencies in three aspects – differentiated and innovative auto insurance products, digitized customer experience and sustainable cost control advantage – to drive innovation in the auto insurance industry in the “Internet +” era.

As CPPIC’s legal counsel, KWM provided professional legal service in all aspects of this transaction. KWM has long acted as legal counsel for CPIC and its subsidiaries, advising on a number of outbound investments and transactions. The KWM team has been highly praised by the clients for their professional performance. The team is led by responsible partner Zhang Yi and supported by partner Liu Dongya.

“KWM was privileged to advise on another landmark transaction that has given birth to an innovative industry model combining insurance with big data.” Zhang Yi said. “We believe that the transaction between CPPIC and Baidu will become a paradigm introducing a different commercial perspective to other investors.”