Sun Life Financial Inc. (TSE:SLF, Mkt cap 26.08B, P/E 12.51, Div/yield 0.38/3.56, EPS 3.41, Shares 610.60M) says its US$975 million acquisition of employee benefits business of Assurant Inc. will widen the scope of its benefits business in North America, the Financial Post (FP) reports.
The purchase of the New York-based specialty insurance operator will see Sun Life double its U.S. group benefits business, with Assurant bringing more than 30,000 customers and 1,700 employees.
The FP suggests the amalgamation will make for the sixth-largest group benefits business in the United States, with in-force business in the region of US$4 billion.
“The acquisition of the Assurant Employee Benefits business is directly on strategy, accelerating the growth of our U.S. Group Benefits business and expanding the scope of our benefits business in North America,” said Dean Connor, Sun Life’s chief executive.
Toronto-based life insurance and wealth management firm Sun Life will boast nearly 4,000 employees in its U.S. group benefits business following the transaction, which will see dental and vision products added to its portfolio.
Excluding transaction and integration costs, the acquisition is expected to be immediately accretive, adding eight cents per share to earnings on an annualized basis in 2016, and 17 cents in 2017.
The acquisition is expected to wrap up by the end of the first quarter next year.
Dan Fishbein, president of Sun Life Financial U.S., added that the deal will allow it to offer one of the most extensive arrays of employee benefits products in the market to its customers.
Meanwhile, increasing ranks will help the firm support future investments as it continues to bolster its U.S. business, Fishbein explained.
Sun Life Financial Inc. is a Waterloo, Ontario based financial services organization. The company provides a range of protection and wealth products and services to individuals and corporate customers. Sun Life operates across 5 segments: Sun Life Financial Canada (SLF Canada), Sun Life Financial United States (SLF U.S.), MFS Investment Management (MFS), Sun Life Financial Asia (SLF Asia) and Corporate.
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