Italy-based underwriter Generali Group has entered into an agreement to dispose of its US life reinsurance business to SCOR, in a deal valued at nearly $920m in a grouping of cash and collateral.
Under the terms of the transaction, nearly $780m will be reimbursed at the closing of the deal, while remaining $140m will be provided in collateral.
The sale, which includes Generali US and its subsidiaries as well as the recapture of the business presently retrocede to Assicurazioni Generali, is part of its strategy to pull out from non-core businesses and optimize capital allocation.
Commenting on the deal, Generali Group CEO Mario Greco said, "The sale of Generali US is a further step in the transformation of our Group and delivering against the goal of re-focusing on our core insurance business."
After completion of the transaction, which is subject to competent regulatory authorities approvals, Generali Group will continue to be active in the US in the P&C segment through its New York branch.
Providing nearly $150m in net capital gain on a consolidated basis, the transaction will boost the Italian underwriter's liquidity position and improve its Solvency I ratio by about 1% point.
Generali US Holdings manages Generali USA Life Reassurance Company that offers reinsurance services for individual and group life products, and the captive company Generali Reassurance (Bermuda).
Citigroup, Mediobanca, Fried Frank and Cleary Gottlieb served as the advisers to Generali pertaining to the transaction.
With an employees strength of 80,000 staff globally, Generali serves 65 million customers in more than 60 nations and hadreported total premium income of €70bn in 2012.