Memo Reveals French Firm Sought to Rescue Indonchine

France’s largest insurance company was committed to rescuing Indochine Insurance from insolvency and investing in Cam-bodia even as the Ministry of Finance sought the troubled company’s forced closure, a document shows.

A leader in France’s insurance industry, Macif planned to merge with Indochine next year, according to a Sept 20 letter from Macif director Jean-Paul Chalet to Cabinet Minister Sok An.

“Our determination is to join together in the first trimester of 2005,” the letter reads.

The merger likely would have allowed Indochine to deposit a capital investment of $7 million as required by law and unburden Indochine of the Finance Min-istry’s complaints that it stood in violation. The Ministry froze Indo-chine’s bank accounts in August, forcing it to declare insolvency last month. Indochine Director Philippe Lenain has accused the government of attacking Indo-chine for the benefit of the state-run Caminco insurance company. Indochine was the leading private insurer in the country before its closure left some 30,000 policy holders in doubt.

Lenain left the country a few days after the announcement, declaring through a fax to media outlets that his safety was in danger. The government is now liquidating the company’s  assets.

A company official, who asked not to be named, reinforced Len-ain’s explanation Sunday, saying the Finance Ministry picked up the long-standing legal complaint against Indochine the day after Chalet visited the country on Aug 17 and pledged support to Lenain. The accounts were frozen Aug 18.

Mey Vann, director of the ministry’s financial industry department, said Sunday that the letter was insufficient proof that a deal with Macif was viable. Such a merger would have required a decision by the company’s board, he said. In the last two years, Indochine tangled with the ministry in court over at least two large compensation cases.

ing the estimated $3 million claim following a fire at the Grandtex International Ltd factory last year, both Mey Vann and the company official said.

 

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