(Reuters) - Equitable Holdings Inc EQH.N said on Tuesday it has entered into an agreement with Venerable Holdings Inc to reinsure about $12 billion in annuities, which will help the insurance firm to return capital to its shareholders.
Venerable, a privately held company, will reinsure legacy variable annuity policies sold between 2006 and 2008 under the deal, Equitable said in a press release.
The deal will generate about $1.2 billion in value for Equitable, which includes a capital release of $800 million.
The transaction will more than double Venerable’s general account assets to $24 billion from $11 billion and result in its reinsured business growing to over $46 billion in separate account value, it said in a separate statement.
New York-based Equitable also said it is in discussions to acquire a 9.9% equity stake in Venerable’s parent holding company, VA Capital Company LLC, including a board seat.
Equitable said it has decided to sell Corporate Solutions Life Reinsurance Company, its runoff variable annuity reinsurance entity, as part of the deal.
Reporting by Maria Ponnezhath in Bengaluru; Editing by Amy Caren Daniel
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