New York - MetLife Inc. reports completion of its $11.8 billion acquisition of New York-based Citigroup's Travelers Life and Annuity Co. and nearly all of Citigroup's international insurance businesses. The New York carrier paid Citigroup $10.8 billion in cash and about 22.4 million of its own shares, which are valued at roughly $1 billion. Travelers Life and Annuity Co., which is based in Hartford, Conn., reported 2004 sales of $822 million. Once the deal is closed, Citigroup says it will record a $2 billion gain in the third quarter.
Industry experts report that the acquisition will give MetLife the highest U.S. ranking in insurance sales. As part of the agreement, MetLife products will be sold through specific Citigroup operations, including Smith Barney brokers, Citibank branches, and Primerica financial planners, in addition to various Citigroup businesses overseas, under 10-year agreements, said MetLife.
Susan Cogswell, Connecticut insurance commissioner, approved the deal just before the July 4th holiday weekend and asked MetLife to periodically report to state officials any changes in its business and employment levels. State law requires Cogswell to consider if the merger would substantially reduce competition or create a monopoly, jeopardize the financial stability of the insurance company, or violate the company's license. The commissioner also must consider whether a proposed merger is in the public interest.
In a separate transaction, the carrier reports agreement with Citigroup to acquire CitiStreet Associates, a unit of CitiStreet LLC, whose business is distributing annuities to the health care, education and nonprofit markets. MetLife did not disclose the value of the CitiStreet Associates deal, which is expected to close on Sept. 1. MetLife said it is not acquiring CitiStreet LLC, which is a joint venture owned equally by Citigroup and State Street Corp.
Source: PR Newswire
