Japanese Insurer in Talks to Buy US Firm

(SYA) said Tuesday that it has agreed to be acquired by Japan’sSumitomo Life Insurance Co. for about $3.8 billion in cash.

Further to the merger, Symetra will become Sumitomo Life’s platform in the U.S. Symetra will maintain its current brand, employees, distribution channels and product mix.

Shares of the company initially jumped more than 9 percent.

Japan’s life insurance market, the world’s second-largest, has been relatively profitable and stable but its weak growth prospects amid a rapidly ageing population have prompted major domestically focused players to look overseas. Symetra shareholders will also receive a previously announced special dividend of $0.50 per share in cash. The company had total assets of $34 billion as of June 30, and it posted net income of $254 million in 2014. It was the biggest ever acquisition of a Japanese life insurance company.

Sumitomo Life, founded in 1907, is the fourth largest life insurer in Japan with premiums of nearly ¥2.6 trillion in the business year ended in March.

Insurers in Asia have been looking to the U.S.as growth slows at home.

Sumitomo Life has hitherto had only minimal overseas operations, consisting of minority stakes in insurance companies in China, Vietnam and Indonesia.

Symetra’s President and Chief Executive Officer, Thomas Marra, and the current management team will continue to lead the business from the company’s headquarters in Bellevue. Symetra’s board unanimously accredited the deal, Sumitomo Life stated.

Sumitomo Life stated it plans to maintain Symetra’s administration group after the transaction closes, which is predicted to happen within the first half of 2016.