Voya To Exit Much Of Its Annuities Business – Insurance News

New York- (Business Wire)-Voya Financial, Inc. (NYSE: VOYA), today announced that he has all his closed block variable annuities (CBVA) segment and its individual fixed and definite indexed annuity business through a compromise, with Apollo Global Management, LLC (with LLC, LLC), “Partners (” “” “Creesvue”). In addition, the compromise will enable Voy to focus on its high-development, high-witness, capital-light retirement, investment management and employee profit businesses.

“Through this transaction, we are further demonstrating our commitment to provide shareholder value by eliminating the risk associated with the CBVA segment and achieving significant value for our annuity business,” Rodney O. Martin, Junior, Chairman and Chief Executive Officer, Vayo Financial, Inc. The fact intensifies that the most important retirement, asset management and employee gain focus to Voya to expand their leadership status as one of the most important retirement, asset management and employee profit companies.

In the transaction, Voya Voya will divide Voya Insurant and Enuity Company (Viac), the insurance assistant who has mainly released the variables, fixed and fixed indexed annuities of the voya. Viac will be acquired by respected holdings, Ink, a newly formed investment vehicle owned by a consortium of investors led by Apollo, Crestview and Shraddha. Ethane Holding, Limited (NYSE: Ath), and Voya will also participate in this consortium, with Voya 9.9% equity share.

After its acquisition of Viac, the honorable will hold all the variable annuity in the CBVA segment of Voya with an account price of about 35 billion on the basis of the remaining amount on June 30, 2017. Concurrent with the sale of Viac, Voya will sell its individual definite and fixed sequencing policies through the re -re -re -assignment with an account price of about 19 billion by June 30, 2017, which represents a significant majority of certain and fixed sequences of futures. The VOYA intends to discontinue non-secular-central personal annuity manufacturing after the transaction is closed.

Depending on the terms of the agreement, Voya estimates that the transaction would result in a value of about 1.1 billion dollars, which includes the benefit of the $ 400 million seding commission paid by the athene by the fixed and fixed sequences of the Voya. Giving effects to some assets that are not liquid today as well as with the expected transactions, restructuring and other costs, Voya hopes to immediately deploy more than $ 500 million capital, which is subject to change until the closure is closed. Voya intends to use deployable capital for additional shares recurrent beyond its $ 1 billion authority. Voya also expects to benefit from the above mentioned assets that are not liquid today-and who are not involved in additional capital over time.

The vios do not expect the transaction to have a significant impact on the net current value of the assets by defying their own.

Martin said, “We have a clearly defined roadmap to develop our lower-row results after the transaction, and we expect to increase the quarterly operating income of Voya per share per share $ 1.10 and $ 1.20 within 12 months of the conclusion of the transaction. To receive this, we will work for the couple as well as the work. cumulative effect.

To achieve your new, targeted annual run-rate cost savings, voya will implement some restructuring expenses. These expenses, which will be classified as a non-operating item, are not reflected in the company’s run-rate saving estimates for 2018.

“Since the end of 2012, we have greatly improved our financial performance and have returned more than $ 3.4 billion in additional capital for our shareholders. We have also created a strong culture, where employees are committed to help both our customers and our communities across the country. We do not pay much attention to raise the brand awareness of Voya. We do not pay much attention to Voya’s brand awareness. The high-development mixture, and we have been posted to build a well-made price, and we have been posted to build the preceded value, and we have been well-planned to be built on the prior price. Continue to improve returns and generate additional values ​​for their shareholders, customers, employees and distribution partners, ”Martin said.

As part of the agreement, Voya Investment Management (IM) will serve as a preferred asset management partner for respected. Voya IM will be – for a minimum of five years after the conclusion of the transaction – manage approximately $ 10 billion account assets under Management (AUM). The Voya IM will also continue to manage the fund platform associated with convertible annuities, represents about 22 billion AUM on September 30, 2017. Voya im will be the preferred asset manager for future blocks acquired by respected. This arrangement focuses on providing specializations of Voya IM’s long-term, risky returns as well as its expertise in meeting the needs of insurance companies.

The transaction, unanimously approved by the board of directors of Waya, is expected to be closed in Q2 or Q3 2018, subject to customary closing conditions including regulator approval.

After completing the transaction, Voya is expected to have an annual free cash flow between $ 600 and $ 700 million and it is estimated that about 80% of its operating income will generate its retirement, investment management and employee profit businesses. As a result of its planned exit from the individual annuity business, Voya intends to make a strategic review of his personal life business during the first half of 2018.

Based on some historical information used in assuming transactions, Voya estimates that it will result in a decrease in tax after $ 2.3 billion for the equity of shareholders, except for accumulated other comprehensive income, most of which reflect one tax-loss that is subjected to finalizing fourth-fourth 2017 financials and will be recorded in the fourth quarter. Estimated losses on sale and tax benefits were maintained (and the capacity of the voy to feel such benefits) is based on the current tax law and subject to the final determination of the tax base of the tasks sold. The fourth quarter of 2017 continues and continues until the transaction is closed, the results of the operation of the sold businesses will be informed as a closed operation for all the periods presented in the company’s financial statements.

Depending on a Pro Form as a Pro form as as September 30, 2017, the company’s per share will be $ 47.38 after giving impact to the book price transactions. After completing the transaction, VOYA will target a loan-to-house ratio of 30%, risk-based capital ratio of 425% and a holding-company liquidity of $ 200 million.

After sales, one of the Viacs or respected colleagues will administer most variables, fixed and fixed indexed annuities, subject to some exceptions and transitional arrangements. Voya’s annuity segment does not have part of some business transactions, which includes approximately $ 6 billion in investment-cavalry products (mainly selection benefits), which will be maintained by Voya.

Goldman Sachs and Company LLC is serving as financial advisor and Wilky Furr and Galagher LLP are serving as Voya’s legal lawyer in relation to this transaction.