(Bloomberg) -- Swiss Re Ltd. struck a deal to sell Aurora National Life Assurance Co. to Reinsurance Group of America Inc. as Chief Executive Officer Michel Lies’s Admin Re business retreats from the U.S. runoff life and health market.
The sale involves $2.7 billion in liabilities and about 82,000 policies, according to an e-mailed statement today from Zurich-based Swiss Re, the world’s second-largest reinsurer. Aurora is part of Admin Re, the Swiss Re unit that winds down life policies issued by other insurers in prior years.
Lies is focusing Admin Re on the U.K. after losses in the U.S. Swiss Re in June agreed to buy the U.K. pension business of HSBC Holdings Plc and in 2012 struck a deal to sell SRLC America Holding Corp. to Prudential Plc.
“This transaction is an important step in Swiss Re’s strategy to redeploy capital to areas where we see growth opportunities,” John Dacey, Swiss Re’s chief strategy officer and chairman of Admin Re, said in the statement. “Admin Re will continue to focus on the U.K. where we have developed a solid pipeline of potential acquisitions.”
The purchase from Swiss Re involves annuities and life- insurance products with risks tied to interest rates, RGA said in a separate statement. Chesterfield, Missouri-based RGA in August announced a deal to take on about 170,000 term-life policies from Voya Financial Inc., which was seeking to free up capital.
Swiss Re rose 1.3 percent at 4:30 p.m. in Zurich trading. RGA climbed 1.7 percent. The transaction is expected to close in early 2015, the companies said.
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