Genworth Announces Sale of Medicare Supplement Business for $290 Million

Genworth Financial, Inc. GNW announces it has reached an agreement to sell its Medicare supplement business and related blocks of in-force business to Aetna Inc. for $290 million. Genworth expects the total capital resulting from this transaction within its life insurance companies that will be available for redeployment to be approximately $240 million. The company will record an after-tax gain of approximately $35 million related to the sale and anticipates that the transaction will close in the fourth quarter of 2011, subject to customary closing conditions and adjustments, as well as regulatory approvals. Existing Medicare supplement policies will remain in effect following the transaction, and policyholders will continue to have access to the full benefits of their policies. "This sale represents another step in executing our strategy to concentrate on leadership positions within our businesses," said Michael D. Fraizer, Genworth chairman and chief executive officer. "The transaction clearly benefits both parties, as it moves a sound platform to a company that is committed to the long term development of the Medicare supplement business, while allowing Genworth to focus our Retirement and Protection segment in markets where we have the strongest value propositions. Looking ahead, we continue to actively pursue strategies that free capital for targeted redeployment and enhance shareholder value over time."