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Japan : HFSG reached an agreement to sell HLIKK for $895 million

May 6, 2014

Hartford Financial Services Group, Inc. (HFSG) announced that it has reached a definitive agreement to sell Hartford Life Insurance K.K. (HLIKK) to a subsidiary of Orix Corp., a publicly held international financial services organization based in Japan, for consideration of $895 million.

HLIKK houses HFSG's Japan annuity operations, the sale of will, with the exception of reinsurance on $1.1 billion of fixed payout annuities written by HLIKK.

Despite the GAAP loss incurred by HFSG on the sale, Fitch views the elimination of the company's exposure to the Japan variable annuity business as a considerable offsetting factor. The sale of this unit is in line with management's stated objective of refocusing HFSG on its ongoing property casualty, group benefits and mutual fund businesses.

HFSG estimates that the sale of HLIKK is expected to close in July 2014, will result in a GAAP loss of $675 million and a substantial statutory capital benefit generated by the sales proceeds and a release of capital backing reserves reinsured by HFSG's US life insurance subsidiaries.

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Source: TendersInfo (India)

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