American Financial To Sell Annuity Business To Massachusetts Mutual Life Insurance For $3.5 Bln

(RTTNews) - American Financial Group, Inc. (AFG) Wednesday said it agreed to sell its Annuity business to Massachusetts Mutual Life Insurance Company for $3.5 billion in cash. Shares of American Financial gained 8% in after-hours trading.

As per the agreement, Massachusetts Mutual will acquire Great American Life Insurance Company and its two insurance subsidiaries, Annuity Investors Life Insurance Company and Manhattan National Life Insurance Company.

The deal is expected to close in the second quarter of 2021.

At December 31, 2020, GALIC and its subsidiaries had approximately $40 billion of traditional fixed and indexed annuity reserves.

Craig Lindner, AFG's Co-Chief Executive Officer, commented, "This transaction presents an excellent opportunity for GALIC and MassMutual to be one of the leading providers of traditional fixed and indexed annuities in major distribution channels and markets. In fact, MassMutual has among the highest insurance financial strength ratings, which we believe will result in enhanced distributor recruitment and policyholder retention."