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In late July, a sale of The Hartford Financial Services Group Inc.'s variable annuity unit was rumored to be imminent. As September approaches and the deal remains unconfirmed, industry experts point to the challenges involved in selling variable annuity blocks in the current interest rate environment.
Reuters reported July 28 that The Hartford was close to an agreement to sell its runoff annuity unit Talcott Resolution to Atlas Merchant Capital LLC, a private equity firm that former Barclays Plc Chief Executive Bob Diamond co-founded in 2013 to invest in the financial services sector. The price tag was reportedly between $3.0 billion and $3.5 billion.
"If reported terms are true, it's an awfully low price," RBC analyst Mark Dwelle said in an interview. "I don't think anyone will be rushing to sell at 50%...