Sun Life might seek to sell U.S. annuities unit for $1 billion
October 29, 2012 by Kelley L. Allen
Posted: October 26, 2012
Sun Life Financial is reportedly looking for a buyer for a U.S. annuities business and is attracting interest from investment firms.
Sun Life, Canada’s third-largest largest insurer, could get more than $1 billion for the sale and could select a buyer soon, according to a Bloomberg report.
The report cited sources who say Morgan Stanley is helping Sun Life solicit bids, with interest reportedly from firms including Guggenheim Partners.
The sale likely would help Sun Life greatly increase its annual operating income with the shedding of variable annuity contracts.
Sun Life announced last year it would stop selling variable annuities and individual life insurance in the U.S.
In March, CEO Dean Connor told investors that that the insurer wants to save $2 billion annually by 2015 and focus on its operations in Canada and Asia, mutual funds and group and voluntary products in the U.S.
Sunlife’s new direction, Connor told investors, “is to reduce the company’s exposure to long-dated, irrevocable, non-adjustable products, and replace them with products that customers need and which fit our desired risk profile.”
Connor was appointed Sun Life president and CEO in December 2011.