Dutch life and pensions specialist Aegon has entered into an agreement to acquire two of Merrill Lynch's insurance businesses, namely Merrill Lynch Life Insurance Company and ML Life Insurance Company of New York, for a total consideration of $1.3 billion in cash.
As part of the deal, Aegon’s Transamerica companies will provide support to the Merrill Lynch financial advisor network. This acquisition is in line with Transamerica’s strategy to develop alliances with strong distribution partners. This new relationship will also place Transamerica in a position of strength in the sale of variable annuities within the wirehouse distribution channel.
Meanwhile, Merrill Lynch will continue to serve the insurance needs of its clients through its core distribution and advisory capabilities. In addition, Merrill Lynch will continue to offer its flagship Merrill Lynch Investor Choice Annuity product through its financial advisor network. Products will be issued by the companies being acquired by Aegon. Both companies anticipate substantial benefits for clients arising from this partnership including increased breadth of product offerings and enhancements to existing products.
With the two acquisitions, Aegon will become a top 10 player of variable annuities sellers in the wirehouse and broker/dealer segment globally. The transaction is expected to close before the end of the fourth quarter of 2007, subject to customary regulatory approvals and closing conditions.