The Hartford to sell retirement plan unit to MassMutual
(Reuters) - The Hartford Financial Services Group Inc (HIG.N) on Tuesday said it would sell its retirement plans business to life insurer MassMutual for $400 million cash, part of The Hartford's plan to shed assets and focus on its property insurance business.
The deal is expected to close by the end of the year. The Hartford, in a statement, said it does not expect a material impact on its financial results.
In late March, The Hartford said it would shut down its annuity business and sell its life insurance operations, as well as the retirement plan and broker-dealer units, as part of a broad restructuring.
The company has been under pressure to boost its stock price from hedge fund manager John Paulson, who is its largest shareholder with a 7.2 percent stake. The Hartford lags peers substantially by most valuation metrics, with price-to-earnings and price-to-book ratios less than half the sector averages.
The sale is the second of three planned asset disposals for the insurer. In late July, it struck a deal to sell the brokerage business Woodbury Financial Services to AIG (AIG.N) in a $115 million transaction.
The retirement plans deal will nearly double the size of MassMutual's retirement services business, which had more than 1.6 million participants and over $66.2 billion in assets under management at June 30.
While The Hartford's business targets small-to-midsize plans, MassMutual's focus has been midsize and larger plans. In a statement, MassMutual said it wanted to grow into new sectors.
Barclays served as financial adviser and Skadden Arps serves as legal adviser to MassMutual. Greenhill & Co and Goldman Sachs were The Hartford's financial advisers and its legal adviser was Sidley Austin.
(Reporting By Ben Berkowitz; Editing by Steve Orlofsky and Leslie Gevirtz)
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