ACE Limited announced that it has signed a definitive agreement to acquire New York Life’s Hong Kong and Korea life insurance operations for approximately $425 million in cash.
ACE said the deal would expand its life insurance business “into two North Asia markets where the company currently has property and casualty (P&C) insurance operations and represents approximately $330 million in incremental life insurance revenues, $2.15 billion in assets and over 2,400 captive agents.”
Chairman and CEO Evan G. Greenberg, commented: “ACE has a good track record for building and managing insurance companies globally and a young but successful record with building de novo life companies in Asia, including China, Vietnam, Thailand and Indonesia.
“These two life insurance companies are small, solid agency operations that have been managed conservatively by New York Life, a venerable and highly professional company. They provide a good foundation on which to build our life operations in these two territories as part of our overall life insurance strategy in the region.
“This transaction is financially attractive to our shareholders. Within the first full year of ownership, the acquisition will be accretive to both earnings and book value per share and will achieve a return on capital that meets our targets.”
ACE said the final purchase price will be “based on the adjusted book value of the life companies at the time of closing. The transaction, which is subject to regulatory approvals and other customary closing conditions, is expected to be completed during the first quarter of 2011.”
The company expects to fund the purchase price for the transaction with available cash. Additional information with respect to the transaction is posted on the company’s website in the Investor Information section.
Source: ACE Limited
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