Sun Life to sell U.S. annuity business for $1.35 billion

(Reuters) - Sun Life Financial Inc , Canada's third-biggest insurer, said it will sell its U.S. annuity business and some life insurance businesses for $1.35 billion to a company owned by shareholders of institutional asset manager Guggenheim Partners.

Sun Life said in December it would stop selling variable annuities and individual life products in the United States to focus more on group insurance and voluntary benefits.

It had billed its decision to pull out of the two capital-intensive businesses, which had become a drag on its earnings, as the start of a "new chapter."

Sun Life said on Monday it expects the sale to Delaware Life Holdings to result in a reduction in book value of C$950 million ($963 million) when the deal closes by the end of the second quarter of 2013.

Sun Life said the transaction is expected to reduce its 2013 earnings by 22 Canadian cents per share.

People familiar with the matter earlier told Reuters that Guggenheim Partners had emerged as the lead bidder for Sun Life's variable annuity business.

The deal is expected to result in a cash of C$1.9 billion, net of a planned repayment of C$350 million of debt in June 2013, Sun Life said in a statement.

Morgan Stanley & Co advised Sun Life on the transaction.

(Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Sriraj Kalluvila)

Source: http://news.yahoo.com/sun-life-sell-u-annuity-business-1-35-123612105--sector.html

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