New York Existence Snaps Up Team Life & Incapacity Insurance policy Company From Cigna For $6.3B

Cigna on Dec. 31 introduced the completion of the sale of its Team Daily life and Disability Insurance plan Small business to mutual lifetime insurer New York Everyday living for $6.3 billion. Shares of the mutual lifestyle coverage firm rose 2% at the near on Thursday.

Previously on Dec.18, 2019, Cigna (CI) disclosed the acquisition could potentially incorporate 3,000 employees, more than nine million prospects, and raise New York Life’s portfolio of strategic companies, supporting the main retail daily life insurance policies franchise and bolstering the company’s financial strength. It was also mentioned that the new small business would be rebranded as New York Life Team Gain Solutions.

Cigna will use the sale proceeds to share repurchase and compensation of debt in 2020. The board enhanced the company’s share repurchase authority by $3 billion to $4 billion. The firm expects the transaction to be neutral to EPS in 2020 and modestly accretive to EPS in 2021.

New York Existence and Cigna have also inked a multi-yr partnership to offer distinguished, cohesive health and fitness and group gain alternatives for clientele and potential clients.

New York Everyday living Team Gain Solutions will operate inside New York Life’s portfolio of strategic corporations, which includes Team Membership Association, Institutional Annuities, Institutional Everyday living, New York Life Immediate, and Seguros Monterrey New York Existence, among others.

“We are fired up to welcome to New York Daily life our new workers and the tens of millions of new purchaser interactions that we will attain as a result of this milestone transaction. We appear forward to making on our primary team profit options industry place in the decades ahead,” stated New York Existence CEO Ted Mathas.

Mizuho analyst Ann Hynes raised the selling price target on the stock to $229 (a 10% upside prospective) from $220 on Dec. 18 and reiterated a Acquire score. Hynes believes scientific labs, deal study corporations and acute treatment have the greatest earnings visibility heading into 2021.

From the relaxation of the Road, the inventory scores an analyst consensus of a Potent Buy based mostly on 13 Purchases and 1 Hold. The ordinary analyst rate target of $253.36 indicates upside opportunity of 21.7% to latest degrees. (See CI inventory examination on TipRanks)

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