(Bloomberg) -- Debt-laden China Evergrande Group may have another asset to sell in its scramble to raise cash: its fast-growing life insurance business.

That’s according to Bloomberg Intelligence analyst Steven Lam, who says the developer’s 50% stake in Evergrande Life Assurance Co. may fetch $600 million at 0.5 times book value. The insurer has boosted its market share more than nine-fold since the year after Evergrande’s 2015 acquisition and been profitable in each of the past four years. 

If that sounds like a bargain to potential buyers, there are some catches. The fast expansion has come at the expense of a low solvency ratio that stood at 110% at the end of June, compared with the 239% average of six large peers, Lam wrote in a note Monday. That means whoever takes over Evergrande’s stake may have to cough up another $2.2 billion to lift the ratio beyond 200%. 

While its 2020 premium income in China may be ahead of AIA Group Ltd.’s, Evergrande Life tilts toward less profitable products, said Lam. The stake may have more appeal to small or medium-sized rivals, instead of the well-established Chinese insurers that the nation’s regulators may wish to absorb it, Lam wrote.

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