Genworth to sell wealth management business for $412.5 million
(Reuters) - Genworth Financial Inc (GNW.N) will sell its wealth management and alternative investment businesses to private equity firms Aquiline Capital Partners and Genstar Capital for about $412.5 million as the insurer looks to raise funds to repay debt.
Genworth, once part of industrial conglomerate General Electric, is selling the businesses as it faces increased scrutiny from ratings agencies, largely due to losses in its mortgage business.
Reuters reported in February that the two private equity firms were in negotiations with Genworth to buy the two businesses.
Genworth will take an after-tax charge of about $40 million related to the sale, with about $35 million recorded in the first quarter, the company said.
Analysts are expecting earnings of $160 million in the first quarter, according to Thomson Reuters I/B/E/S.
Genworth sold its tax and accounting financial adviser unit to California-based Cetera Financial Group last April.
The company said in January it was reorganizing itself to separate its mortgage insurance business from the rest of the company, reducing the risk of default on its bonds.
Genworth shares were up about 3 percent at $10.48 in extended trade. They closed at $10.19 on the New York Stock Exchange on Wednesday.
(Reporting by Ashutosh Pandey in Bangalore; Editing by Sriraj Kalluvila)