The completion of China Oceanwide’s $2.7bn merger deal with Genworth Financial is likely to be delayed further, owing to a regulatory obstacle.

In this connection, the two companies, have for the second time, withdrawn and re-submitted their joint voluntary notice with the Committee on Foreign Investment in the United States (CFIUS).

The move will give the regulator more time to review and discuss the proposed merger transaction.

The completion of the transaction will now be pushed further as CFIUS' acceptance of the notice will begin a new 30-day review period and is likely to be followed by an additional investigation period spanning 45 days.

Originally, the transaction was expected to be closed in the middle of 2017 with a deadline of August 31 which has been indefinitely extended by the two companies. In the coming weeks, Genworth and Oceanwide will finalize on the deadline for the transaction.

China Oceanwide Group chairman LU Zhiqiang said: “We are working with Genworth to complete this transaction so that we can strengthen Genworth's financial position and the viability of its long term care business in the U.S. as well as bring Genworth's expertise in long term care insurance to our country for the benefit of our aging population.”

Apart from an approval from CFIUS, the transaction is still subject to other conditions like receipt of mandatory regulatory approvals in China, the US and other international jurisdictions.

It was in October last year that China Oceanwide entered into a definitive agreement to acquire the Virginia-based insurer Genworth Financial through its investment platform, Asia Pacific Global Capital.

Earlier this month, Genworth had secured approval from the Delaware Department of Insurance and the Virginia Bureau of Insurance for the remaining internal reinsurance and recapture transactions to meet one of the conditions for the merger deal.

Genworth Financial president and CEO Tom McInerney said: “The Genworth Board is fully committed to closing the transaction because it is the best option for our shareholders.

“This transaction also achieves the best outcome for the policyholders of our insurance companies and other important stakeholders.”

Image: Headquarters of Genworth Financial in Richmond, Virginia, USA. Photo: courtesy of Genworth Financial, Inc.