Hartford Financial Services Group Inc. (NYSE: HIG), one of America's largest investment and insurance companies, announced it will sell all of the assets of Hartford Life Private Placement LLC, a subsidiary that provides insurance to high-net-worth customers, to Philadelphia Financial Group Inc. for $117.5 million.
The transaction is expected to close in 2012, though it is subject to regulatory approvals and closing conditions. Upon closing, Philadelphia Financial will take over the $35 billion private placement insurance business previously serviced by Hartford Life Private Placement.
"This acquisition significantly extends our market leading ultra-high net worth private placement franchise into the bank and corporate owned arena and provides a long-term relationship with The Hartford," John Hillman, chief executive officer of Philadelphia Financial, said in a statement jointly issued by the companies.
Hartford's president of wealth management, David Levenson, added that this transaction is consistent with the company's concentration on core businesses and operations.
Hartford Life Private Placement expects to transfer all its employees to the acquiring company and continue to operate out of the New Jersey facility.
The two companies said they do not anticipate any changes to policy terms, investment managers, stable value agreements, pricing or service standards as a result of this deal.
Early November, the Hartford reported net income of $0 million, or a loss of 2 cents per diluted share for the third quarter ended Sept. 30, 2011. The company attributed the loss to a combination of volatility in the capital markets and significant catastrophe claims.