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17 April 2024

Warburg to buy Primerica shares

By Reuters

The private equity company Warburg Pincus plans to buy about $230 million (Dh844.1m) of common stock in Primerica from Citigroup in connection with the bank's planned initial public offering for its life insurance unit.

The planned purchase was revealed in a US Securities and Exchange Commission filing on Tuesday.

Warburg Pincus also has a right to buy another $100m of Primerica shares at the IPO price, and a warrant to buy a number of additional shares, equal to 25 percent of whatever number it commits to purchase, the filing shows.

It also would be entitled to two board seats, the filing shows.

Citigroup said on November 5, 2009, it planned to sell Primerica shares, after failing to find a buyer for the entire business that was willing to pay enough.

The third-largest US bank is trying to shed assets, including Primerica, that are not part of what it considers its core banking operations.

After a few taxpayer bailouts, the federal government at year end owned a roughly 27 per cent stake in the New York-based bank. Many assets being sold were assembled by former Chief Executives Sanford Weill and his successor Charles Prince.

Primerica said it insures 4.3 million people, mainly from households with annual incomes between $30,000 and $100,000, and more than two million clients with investment accounts.


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