View this article online: https://www.insurancejournal.com/news/international/2002/01/21/15994.htm
The Netherlands AEGON N.V. has agreed to sell its minority partnership interests in two Mexican companies to Citigroup’s Mexican subsidiary Grupo Financiero Banamex for $1.24 billion.
The sale of its stakes in life insurance business Seguros Banamex AEGON, and Afore Banamex AEGON, a pension fund management company, will further strengthen Citigroup’s financial services operations in Mexico, already the largest in the country.
AEGON announced that the sale, to be made effective as of December 31, 2001, would result in a book gain of $800 million; $500 million will be credited to shareholders equity and the remainder as capital gains. The company will also receive $
40 million as dividends on the 2001 profits of the joint venture companies.
AEGON, the parent company of Transamerica Corp., has estimated its exposure to Enron related losses at around $300 million. It announced that it would use the proceeds from the sale of the Mexican interests to “strengthen its default reserves as a result of increased default activity in AEGON’s bond portfolios.”
It indicated that the move would assure that any defaults have “no meaningful impact on AEGON’s earnings forecast for 2001,” and maintained its earlier forecast of “an increase in 2001 earnings and earnings per share between 12% and 17%, with the earnings per share increase expected to be at the low end of this range.”|”aegon, sells, banamex, stakes, citigroup