Genworth to sell wealth management business
By National Underwriter
By Warren S. Hersch
Genworth Financial, Inc., Richmond, Va., has announced it has reached an agreement to sell its Wealth Management business, including Genworth Financial Wealth Management and alternative solutions provider, the Altegris companies, to a partnership of Aquiline Capital Partners and Genstar Capital.
The sale price is expected to be approximately $412.5 million and the company will record an after-tax loss of approximately $40 million related to the sale with approximately $35 million recorded in the first quarter of 2013 and the remainder upon closing. The sale is expected to close in the second half of 2013, subject to customary closing conditions, including requisite regulatory approvals.
Proceeds from the transaction, net of transaction related expenses, will be held at the holding company and be used to address the 2014 debt at maturity or before.
"This transaction is another step forward in executing our strategy, by generating capital from a non-core business and increasing financial flexibility for Genworth," says Martin P. Klein, executive vice president and chief financial officer. "The sale of Wealth Management also provides the opportunity for our employees there and the purchaser to have a strong business to grow going forward."
As of the first quarter of 2013, the Wealth Management business will be classified as an asset held for sale in the balance sheet and discontinued operations in the statement of net income, and will be excluded from operating income. The company will provide further updates associated with this transaction on its first quarter 2013 earnings call.
Goldman, Sachs & Co. and Sullivan & Cromwell LLP advised Genworth on this transaction.
Originally published on LifeHealthPro.com