MetLife to acquire Chile's largest pension fund Provida for $2 bn

MetLife Inc, one of the world's leading insurance providers,is buying Chile's largest pension business AFP Provida SA (Provida) for approximately $2 billion, expanding the US insurance giant's presence in the emerging markets.

Under the terms of the agreement with Spanish banking major BBVA SA, Provida's 64-per cent shareholder, MetLife will tender an offer of around $6.04 per share for all of the 331 million outstanding shares of Provida, including the BBVA's stake and free float. The deal also includes Provida's small asset management business in Ecuador.

The total value of the transaction, including the publicly-held shares, is approximately $2 billion.

Besides, Provida shareholders are expected to get $340 million or about $1.03 per share in dividends and also proceeds from the sale of Provida's minority stakes in its businesses in Mexico and Peru, which are not part of the deal.

MetLife chairman and chief executive officer Steven Kandarian said in a statement: "With this acquisition, MetLife is delivering on a key component of our strategy – expanding our presence in emerging markets,"

"MetLife is a leader in both life insurance and annuities in Chile, and Provida will further strengthen our position by adding the country's top pension franchise. The acquisition also supports our focus on shifting our business mix to less capital intensive products,'' he further stated.