The deal will double Principal’s U.S. retirement business and expand its reach with mid-sized employers, giving it 7.5 million retirement customers nationwide. The purchase, which is expected to be completed in the third quarter, will add to the company’s net income next year, Principal said.
“The acquisition will bring expanded capabilities, reach and scale,” Principal Chief Executive Officer Dan Houston said in his company’s statement.
To help finance the purchase, Principal will suspend its share-buyback program, resuming it no later than the first quarter of next year, Houston said on a conference call Tuesday. The acquisition also will be financed with debt and cash on hand, the company said.
Lazard Ltd. was a financial adviser to Principal on the deal, and Debevoise & Plimpton LLP was its legal counsel. Wells Fargo’s investment-banking arm advised the company on the sale, while Skadden, Arps, Slate, Meagher & Flom LLP was its legal adviser.
This article provided by Bloomberg News.