The sale of British Columbia's largest provider of seniors' care to a Chinese insurance conglomerate has cleared the last hurdles, sidestepping concerns about the company's murky ownership.
B.C. health officials have granted all the required licences to allow the sale of Retirement Concepts to a subsidiary of Anbang Insurance in a deal believed to have exceeded $1-billion. The giant firm has faced questions in the United States over its ownership and possible ties to the Chinese state.
It took a little more than a week after Ottawa approved the sale for the province to complete its "due diligence" reviews and issue the new licences for 20 seniors' care facilities across the province.
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That timeline has raised concerns from public-health-care advocates.
"We are talking about the largest provider of residential care and assisted living in B.C. being handed over to a major offshore corporation. The province has a duty to look into it carefully," Adam Lynes-Ford of the BC Health Coalition said.
"It's not just money and business. It's about inherent values in the way we provide care, it's about taking care of the elders of our society, and providing the best possible care for their well-being – not profit. Handing that over to a multinational of which we know very little, with the province unconcerned about learning their ownership and their intentions, raises serious questions," Mr. Lynes-Ford said.
The province received a commitment that the company will continue delivering existing services for a minimum of three years under the new ownership. That goes beyond existing provincial regulations which would have only demanded a one-year guarantee, but details of that agreement are shrouded in secrecy.
Retirement Concepts was paid close to $90-million by the province in the last fiscal year to provide more than 1,200 publicly funded beds for seniors in residential care and assisted living services.
Health Minister Terry Lake said he is not privy to details of the sale of Retirement Concepts; that decision was made exclusively by Investment Canada. Navdeep Bains, the federal Minister of Innovation, Science and Economic Development, said the deal, first revealed by The Globe in November, was approved "because the acquisition will result in a net economic benefit to Canada."
The B.C. Health Minister blasted critics of the deal, telling reporters in Victoria that there is no reason for seniors at Retirement Concepts facilities to be concerned about the change in ownership.
"I think there is a level of fear-mongering that is going on with seniors and their families around this issue. They can be assured that we have strong protections in place through legislation, through our medical health officers. … I'm confident seniors are very well protected."
Anbang, one of China's top insurers, has been buying up real estate in Canada and the United States. The federal government has provided scarce information on its decision to approve the company's entry into the Canadian health sector, identifying the new owners only as Cedar Tree Investment Canada Inc.
The New York Times last year reported that 92 per cent of Anbang was held by firms fully or partly owned by relatives of Anbang's chairman, Wu Xiaohui; or his wife, Zhuo Ran, the granddaughter of former Chinese leader Deng Xiaoping; or Chen Xiaolu, son of a famous People's Liberation Army general.
Lack of transparency has been an issue for the company in the past. Reuters has reported that last year, Anbang withdrew an application for regulatory approval to purchase Iowa-based Fidelity & Guaranty Life after the New York Department of Financial Services sought more details about the Beijing firm's funding and shareholder structure. Anbang did not provide the information.
Mr. Lake said he does not have details of how Canada arrived at its decision to approve the sale, and maintained it is not relevant to the province's duty to oversee seniors' care.
"For us, the decision about ownership was made by the federal government," he said. "That's a confidential process."
As the minister responsible for approving the sale, Mr. Bains stressed in a statement that the operation will not change. "Cedar Tree has agreed to maintain at least the current levels of full-time and part-time employees at facilities operated by Retirement Concepts; ensure a significant ongoing role for Canadians in the business; have the current Canadian operator, Retirement Concepts, continue to manage the business; not close or re-purpose any of the existing residences."
However, it is not clear how the three-year commitment was negotiated or what might happen after that. The province deferred questions about the agreement to maintain services to Azim Jamal, president of Retirement Concepts. Mr. Jamal, in a written statement on Wednesday, said the details of that agreement also are confidential.
"Our agreements are with various partners and governmental bodies. As such, we are unable to release these agreements for confidentiality reasons," the statement read. Retirement Concepts has 20 facilities in British Columbia, as well as two facilities in Alberta and one in Quebec.
Mr. Jamal stated: "I can confirm that Retirement Concepts is contractually obligated to manage the day-to-day operations at each of the 23 properties forming the partnership between Retirement Concepts and Cedar Tree for a minimum of three years from the closing date of the partnership transaction."