Chubb Limited (CB), a property and casualty insurance company, announced Friday that it has completed its acquisition of Cigna Corp.’s (CI) certain life, accident and supplemental benefits businesses in Asia-pacific in a $5.36 billion deal.
The acquisition includes the life and non-life insurance companies that house the personal accident, supplemental health and life insurance business of Cigna in six Asia-Pacific markets.
Cigna’s accident and health or A&H and life business in Korea, Taiwan, New Zealand, Thailand, Hong Kong and Indonesia were part of the deal. The acquired business has nearly 3,000 employees, who will now be part of Chubb.
According to the company, the reduction in the final purchase price from the original announcement reflects the impacts of rising interest rates and foreign exchange rates on acquired book value and other minor adjustments.
With the acquisition, Chubb aims to expand its presence in the Asia-Pacific region, a long-term growth area for the company.
With the addition of Cigna’s business, Asia-Pacific’s share of Chubb’s global portfolio will grow to approximately $7 billion in premium from $4 billion,and A&H writings will increase in size to around $6 billion in premium, up from $3.7 billion.
Meanwhile, Cigna, in its statement, said the divestiture of its life, accident and supplemental benefits businesses in six Asia-Pacific markets was to sharpen focus on its expanding health portfolio.
Cigna and Chubb previously agreed to exclude Cigna’s interest in a joint venture in Turkey from the transaction.
Cigna said it expects to realize around $5.1 billion of net after-tax proceeds from the transaction. Proceeds from the deal are expected to be utilized primarily for share repurchase.
Cigna remains on track to repurchase at least $7 billion of its shares in 2022.
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