NEW YORK and BLOOMFIELD, Conn., December 18, 2019 - New York Life and Cigna introduced in the present day that they've entered right into a definitive settlement for New York Life to amass Cigna's group life and incapacity insurance coverage enterprise for $6.three billion. The acquisition is anticipated to shut within the third quarter of 2020, topic to relevant regulatory approvals and different customary closing circumstances.
"This transaction will increase the worth we are able to ship to our coverage homeowners, strengthens our well-defined enterprise mannequin, and provides tens of millions of consumers to the New York Life household," stated New York Life Chairman and CEO Ted Mathas. "Cigna's group life and incapacity enterprise enhances our portfolio of strategic companies and is led by an skilled administration crew and high-quality workforce, who we look ahead to welcoming to our firm. We're absolutely dedicated to creating this transition as seamless as doable for workers and shoppers alike."
The group life and incapacity insurance coverage enterprise will function inside New York Life's portfolio of strategic companies, which, like Cigna's Group Insurance coverage enterprise, are extremely worthwhile, and absolutely assist New York Life's core retail life insurance coverage franchise. These companies reinforce New York Life's total monetary power by producing capital that may contribute to its surplus, dividends, and earnings, which straight advantages the corporate's coverage homeowners. As well as, the Cigna Group Insurance coverage staff, in addition to the staff who primarily assist the acquired enterprise, will switch to New York Life.
"We're pleased with what we have now achieved in our life and incapacity enterprise, and the world-class crew that powers it. We're assured that shoppers and prospects, together with the numerous who additionally obtain well being and associated advantages via Cigna, will proceed to benefit from the high-quality advantages options and repair for which this enterprise is thought," stated Matt Manders, Cigna's President of Technique and Options.
"Our crew is worked up to turn out to be part of New York Life and proceed to deal with the mission of offering monetary safety and peace of thoughts to people, households, and companies throughout the nation whereas our unwavering dedication to specializing in productiveness will proceed," stated William Smith, President of Cigna Group Insurance coverage.
In a multi-year collaboration, following closing, the events will proceed to carry an built-in Well being / Group providing to shoppers and prospects who need it.
Extra Data
New York Life can pay Cigna money consideration of $6.three billion. The transaction just isn't topic to a financing situation at closing. Cigna expects to comprehend roughly $5.three billion of web after-tax proceeds from this transaction. Cigna expects to make the most of proceeds of the transaction for share repurchase and reimbursement of debt in 2020. Cigna's Board of Administrators has elevated the corporate's share repurchase authority by $three.zero billion to an mixture quantity of $four.zero billion.
Cigna expects the affect of the transaction to be impartial to earnings per share in 2020 and modestly accretive to earnings per share in 2021. Cigna continues to count on to satisfy its deleveraging commitments made following the Categorical Scripts mixture.
Post a Comment