Goldman Sells U.K. Insurer Stake to GIC, Blackstone, MassMutual

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Blackstone Group LP, Massachusetts Mutual Life Insurance Co. and GIC Pte, Singapore’s sovereign-wealth fund, agreed to buy Goldman Sachs Group Inc.’s remaining stake in Rothesay Life Plc.

The deal values Rothesay Life at about 2 billion pounds ($2.6 billion), according to a person with knowledge of the deal, who asked not to be identified because the terms are private. A spokesman for Rothesay declined to comment on the size of the transaction.

Private-equity firms and hedge funds have been buying stakes in insurers because they generate steady cash flows. Rothesay manages about 23.7 billion pounds of capital and specializes in paying pensions if retirees live beyond a certain age, using derivatives to hedge the risk. Blackstone and GIC have owned a majority shareholding in the insurance business since 2013 with MassMutual also acquiring a stake. Goldman retained 36 percent at the time.

The sale is expected to be completed in the fourth quarter, the companies said in a joint statement on Wednesday.

“There is a tremendous market opportunity for de-risking solutions in the U.K., and Rothesay Life, with its proven track record of success, is well-positioned to capitalize on that demand,” Tim Corbett, chief investment officer at MassMutual, said in the statement.

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