Manulife Financial To Buy New York Life's Retirement Plan Services Business

(RTTNews) - Canadian financial services firm Manulife Financial Corp. (MFC.TO, MFC) announced that its U.S. Division, John Hancock Financial, and New York Life have entered into an agreement by which John Hancock will acquire New York Life's Retirement Plan Services or RPS business. Terms of the transaction were not disclosed.

The transaction is expected to be modestly accretive to core earnings per share in the medium term, with no material short term impact to core earnings per share.

John Hancock's acquisition of New York Life's RPS business will increase John Hancock's RPS assets under administration by approximately 60 percent, accelerate its expansion into the mid-case to large-case private sector retirement plan markets, and add both scale and expertise to John Hancock in a strategically significant line of business.

The resulting combined RPS businesses will consist of approximately US$135 billion in assets under administration, 55,000 retirement plans and 2.5 million plan participants.

John Hancock and New York Life also entered into an agreement pursuant to which New York Life will assume, by way of reinsurance, 60 percent of John Hancock's in-force participating life insurance closed block, which was written prior to John Hancock's demutualization in 2000. John Hancock will continue to service the policies and there will be no change in contract terms or policyholder benefits as a result of the reinsurance. New York Life provided information on this transaction in a separate news release issued today.

The transaction is expected to close in the first half of 2015, subject to regulatory approvals and other customary closing conditions.