According to Aegon, the Merrill Lynch acquisitions produced $800 million in variable annuity sales last year, and posted $10 billion in variable annuity assets at the end of the year. The deal will place Aegon among the top ten variable annuities sellers worldwide in the broker-dealer segment.
Said Aegon USA president and CEO Pat Baird about the motivation behind the acquisition, "To have a strategic sales relationship with one of the most important distributors of insurance and savings products in the United States is obviously the main rationale."
The agreement, which is slated for completion by year-end, also marks the formation of a strategic relationship with Merrill Lynch in insurance and investment products and that Aegon's Transamerica companies will support Merrill's financial adviser network.
Aegon representatives expect the acquisition to have a marginally positive effect on earnings per share. Merrill Lynch says it expects to record a significant gain on the sale during the fourth quarter of 2007, and also believes the purchase will give earnings per share a slight boost.