Swiss Re, whose U.S. headquarters are in Armonk, will sell its U.S. Admin Re business to Jackson National Life Insurance for $600 million in cash. Swiss Re will also get a pre-closing dividend of $300 million.
U.S. Admin Re, which operates as a subsidiary of Reassure America Life Insurance Co. (REALIC), expects a loss of $900 million from the transaction, which it said will be booked in the second quarter of 2012. The exact amount of the loss will be determined at closing. Swiss Re will retain certain blocks of business.
Jackson National Life Insurance is headquartered in Lansing, Mich., Jackson National Life Insurance Co. of New York is based in Purchase.
Swiss Re said it wanted to free capital and monetize the value of Admin Re. It also said it wants to focus on life insurance in the UK and Continental Europe.
“After conducting a thorough review of the Admin Re portfolio and evaluating the level of capital allocated to the Admin Re U.S. business, we concluded that we should redeploy the capital in other parts of our business,” said Admin Re Chairman David Blumer.
“We consistently said the Group”™s 2011-2015 financial targets are our top priority,” said Swiss Re Group Chief Executive Michel Liès. “Redeploying the funds freed up through this transaction within the Swiss Re Group will have a beneficial impact on all three of our financial targets in the future, that is to say return on equity, earnings per share and economic net worth growth.”
