(Bloomberg) -- Citic Group Corp., one of China’s largest state-owned conglomerates, is in talks to buy a stake in Dajia Insurance Group Co., the company that was created three years ago to take over assets of now-defunct Anbang Insurance Group Co., according to people familiar. 

Citic conducted due diligence on Dajia following government directives, after the insurance operator failed to find qualified private buyers, the people said, requesting not to be named because the matter is confidential. 

Citic is also discussing taking over management of Dajia, the people added. One of the people said that the state-backed conglomerate could acquire a 20% stake. The plan hasn’t been finalized and is subject to regulatory approval, the people said. 

Despite the government wanting to keep Dajia a privately owned operation, the lack of buyer interest is prompting officials to seek alternatives, the people said. If it goes through, it would be another case where Citic steps in to help rescue a company deemed too big to fail. 

Citic was also part of the state-backed bailout of China Huarong Asset Management Co. after the bad-debt manager posted a record 102.9 billion yuan ($15.3 billion) loss.  

The China Banking and Insurance Regulatory Commission didn’t immediately respond to requests for comment. A Dajia representative said the company has no information to disclose on strategic investors. A Citic Group representative had no immediate comment.

Authorities seized control of Anbang in February 2018 and later sentenced former Chairman Wu Xiaohui to 18 years in prison for fundraising fraud and embezzlement. The company was then folded into a newly created entity known as Dajia in 2019. Anbang was emblematic of the country’s unbridled appetite for international trophy assets before being reined in. 

Auctions for a 98.78% stake sale of Dajia received no offers by a September 2021 deadline, Caixin reported in October. About 98.2% of that was held by state-owned bailout fund China Insurance Security Fund Co., and the rest by China Petrochemical Corp. and Shanghai Automotive Industry Corp. 

The company’s state shareholders have had to slash the price of their stake to 30.2 billion yuan from 33.6 billion yuan in August, according to exchange documents. 

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