MetLife Inc. (MET:US) said it is negotiating to buy AFP Provida SA, Chile’s largest private pension fund administrator, from Banco Bilbao Vizcaya Argentaria SA (BBVA) as the insurer seeks to add fee income outside the U.S.
MetLife, the largest U.S. life insurer, disclosed the discussion after majority owner BBVA said in a statement it was in advanced talks with the company over a possible deal, following reports in the media. Provida has a market value of about $2.4 billion.
MetLife Chief Executive Officer Steven Kandarian is expanding outside the U.S. as low interest rates and slow economic growth weigh on results at the New York-based company. Kandarian has set a goal of generating at least 20 percent of operating earnings from emerging markets like Chile by 2016 as he targets return on equity of 12 percent or more.
“No agreement has been reached and there are no assurances that an agreement will be reached,” MetLife said in a statement, which didn’t disclose potential pricing.
BBVA has sought buyers for its pension-fund assets in Chile, Mexico, Peru and Colombia as it attempts to recover from Spain’s real estate slump. The Bilbao, Spain-based company agreed in November to sell the Mexican operation to a group of local buyers for $1.6 billion.
MetLife purchased American Life Insurance Co. for about $16 billion from American International Group Inc. (AIG:US) in 2010 to expand beyond the U.S. The unit had about 12,500 employees and operations in more than 50 countries at the time.
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