(Adds Morgan Stanley declining to comment, stock price,
NEW YORK, March 26 U.S. insurer Protective Life
Insurance is the leading candidate to buy some of AXA
SA's U.S. life insurance assets in a deal that could be
valued at around $1 billion, according to two people familiar
with the situation.
French insurer AXA hired Morgan Stanley last year to
help find a buyer for the assets, including remnants of the Mony
Group Inc business that it acquired in 2004, according to the
sources who spoke with Reuters this week. Both sources asked not
to be named because the matter is not public.
AXA, which bought New York-based life insurer Mony Group for
$1.5 billion, has been expanding into emerging markets while
scaling back its presence in North America after years of
Spokeswoman for AXA and Morgan Stanley declined to comment.
Birmingham, Alabama-based Protective Life did not immediately
respond to requests for comment.
AXA, Europe's second-largest insurer behind Germany's
Allianz, like its peers has grappled with the
uncertain euro zone investment market as well as low interest
rates, which have hurt its asset management and savings
In 2011, the insurer announced a strategic plan targeting
1.5 billion euros in cost savings in "mature markets" by 2015,
by which time it hoped to lift its adjusted return on equity to
The current sale comes after years of underperformance in
AXA's U.S. business, most of it centered in the sale of variable
annuities. Although AXA has lately narrowed those losses, the
insurer has made it clear that its acquisition priorities lie in
emerging markets such as Asia rather than mature ones.
AXA, whose other units include AllianceBernstein Holding,
has already taken steps to cut back on its North American
presence, selling its Canadian business in 2011 while it has
expanded in Asia by acquiring HSBC's general insurance
businesses there among other assets.
Protective Life, which has a market capitalization of $2.72
billion, was trading at $35.81 in late afternoon trading, up 3
percent on the day.
(Reporting By Jessica Toonkel; Editing by Gerald E. McCormick,