Cigna Corp. has struck a $5.75 billion deal to sell its life, accident, and supplemental businesses to Swiss insurer Chubb Ltd.
The agreement is “another step forward” in advancing Cigna’s strategic focus on its global health businesses, Chief Executive Officer David M. Cordani said in announcing the deal Thursday night. It’s expected to be completed next year.
Chubb was rebuffed earlier this year when it made an unsolicited $23 billion offer for The Hartford Financial Services Group Inc.
Chubb will acquire the Cigna businesses in Hong Kong, Indonesia, Korea, New Zealand, Taiwan and Thailand and Cigna’s interest in a joint venture in Turkey. In Korea, Chubb will acquire and plans to continue to operate the business under the LINA Korea brand, also known as Life Insurance Co. of North America.
Cigna said it will continue to operate its international health businesses and local market services in the Middle East, Europe, Hong Kong, Singapore and joint ventures in Australia, China and India. It said it expects to realize about $5.4 billion of net after-tax proceeds and will use the proceeds primarily for share repurchase.
The impact of the transaction is expected to be neutral or will slightly reduce Cigna’s profit in 2022, it said.
Chubb Chairman and CEO Evan Greenberg said the acquisition will rebalance its global portfolio toward Asia.
The Hartford’s board unanimously rejected Chubb’s play for the insurer in March as not in the best interests of the company or shareholders. Chubb said then it remained a “disciplined acquirer.”
In 2019, Cigna sold its group life and disability coverage business to New York Life.
The previous year, Cigna closed on a $67 billion deal for Express Scripts, one of the nation’s largest pharmacy benefits managers. The acquisition added to the insurer’s business mix and gave it more patient data to help with its care management focus.
