Aegon sells reinsurance unit to Scor to help pay off its outstanding state aid

 
City A.M. Reporter
FRENCH reinsurer Scor is to pay $913m (£554.6m) for most of Dutch insurer Aegon’s Transamerica Reinsurance operations, to make it the second largest life reinsurer in the US.

Aegon, which has been winding down and selling operations after requiring state aid at the height of the credit crisis in 2008, said yesterday the disposal would help it repay outstanding aid of €1.125bn.

The deal is the latest in a round of consolidation in the North American life reinsurance market, as companies try to position themselves for a rebound after the financial crisis.

Last October, Warren Buffett’s Berkshire Hathaway agreed to buy Canadian insurer Sun Life Financial’s reinsurance business.

Europe is Scor’s biggest market and Transamerica will boost its market share in the US, where it currently earns less than 30 per cent of its global life reinsurance premiums.

“With the acquisition of a major mortality risk reinsurance portfolio in the United States, Scor aims to further increase its geographical diversification,” it said.

Scor, which also sells property and casualty reinsurance, eclipsed Reinsurance Group of America as the lead bidder for Transamerica in March.

Scor said it would pay for the deal through its own funds and a potential debt issue of around €200m, without the issuance of any new shares.