New York Life Insurance is in advanced talks to acquire a Cigna unit that sells nonmedical insurance coverage to employers for nearly $6bn, according to multiple people briefed on the negotiations.
The deal would bolster New York Life as it seeks to broaden its business beyond its core life insurance and annuities franchises, units that have come under pressure from a slide in interest rates and intense competition from rivals.
New York Life had emerged as the frontrunner over MetLife and Sun Life Financial in the auction for the Cigna unit, which sells accident, disability and life insurance plans to companies to offer to their employees, the people said.
New York Life and Cigna could ink a deal as early as this month, the people added. However, they cautioned that no agreement had yet been signed and another bidder could emerge with the Cigna unit if negotiations with New York Life break down.
Cigna, MetLife, New York Life and Sun Life declined to comment.
A sale of the unit would provide Cigna with a significant cash infusion after its blockbuster $67bn takeover of pharmacy-benefit manager Express Scripts last year. That deal saddled Cigna, which has a market value of about $72bn, with tens of billions of dollars of debt and prompted credit rating agency S&P Global to downgrade its opinion of the health insurance group.
The Wall Street Journal earlier reported on the sale of the unit.