DOW JONES NEWSWIRES
Citigroup Inc. (C) announced plans to have an initial public offering of its Primerica Inc. life-insurance unit as the financial giant looks to continue separating its noncore businesses.
"Today's announcement represents an important step in simplifying our organization and demonstrates our continued success in finding solutions for Citi Holdings, our non-core businesses," Citi Holdings Chief Executive Michael Corbat said. "We believe this is the best separation alternative for this franchise."
Citigroup, which earlier this year approached several private equity firms about the potential purchase of the unit, said it intends to divest its remaining interest in Primerica after completion of the offering.
The company didn't say how much it will own after the IPO, only that up to an estimated $100 million of stock would be sold.
Primerica, which has about 100,000 sales representatives, offers life insurance and investment products like mutual funds and targets middle-income households.
In the first half of 2009, it had earnings of $244.7 million on revenue of $1.09 billion, down from $269.1 million and $1.19 billion, respectively.
Through reinsurance arrangements covering insurance policies in place as of Dec. 31, Citi said it will continue to receive a "significant stream of income" from Primerica.
-By Lauren Pollock, Dow Jones Newswires; 212-416-2356; lauren.pollock@dowjones.com