J.C. Penney, Plano, TX, plans to sell the assets of its J.C. Penney Direct Marketing Services Inc., including its life insurance subsidiaries to AEGON N.V., for a total of $1.6 billion.
AEGON, with assets of $230 billion, is an international insurance and financial services group based in The Hague, Netherlands.
Penney’s DM Services operations, which will become part of the AEGON USA companies, was acquired or $1.3 billion in cash plus another $300 million cash over the next 15 years.
Allen Questrom, chairman/CEO, said Penney, which expects to clear $1.1 billion after taxes, will use most of the money to pare down its debt.
Completion of the sale, pending federal regulatory approval, is expected by late spring.
Penney, as part of the deal, is entering a 15-year strategic marketing alliance with and AEGON to offer an expanded range of financial and membership services to Penney’s customers through AEGON’S Commonwealth General subsidiary, making AEGON USA the nation’s largest direct marketer of life and supplemental life insurance products.
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