Axa SA, Europe’s second-largest insurer, agreed to sell a U.S. unit and transfer certain obligations to Protective Life Corp. for $1.06 billion, according to two people with knowledge of the deal.
Axa is selling Mony Life Insurance Co. to Birmingham, Alabama-based Protective, which will reinsure some life policies, said the people, who requested anonymity because the deal hasn’t been announced. Axa will still offer life insurance and retirement products in the U.S. and the agreement doesn’t include the Mony distribution network, the people said.
Axa, led by Chief Executive Officer Henri De Castries, had been seeking a deal to sell some U.S. life obligations to free capital. The Paris-based company has sought to expand in Asia and other emerging markets as a slow European economy and low bond yields weigh on profits.
Cigna Corp. reached a $2.2 billion deal with Warren Buffett’s Berkshire Hathaway Inc. in February to cut liabilities tied to death benefits. Sun Life Financial Inc. agreed to sell its U.S. annuity business in a $1.35 billion deal in December as CEO Dean Connor worked to reduce risk.
Christina Anderson, a spokeswoman for Protective, didn’t immediately respond to requests for comment. Discretion Winter, an Axa spokeswoman, declined to comment.