Interest in Keyport Life Insurance's (Boston) distribution system played a part in Toronto-based Sun Life Financial Services of Canada Inc.'s decision last week to acquire the annuity and bank marketing business of Keyport Life's parent, Liberty Financial Companies, for approximately $1.7 billion.
"When making the decision to acquire Liberty Financial Companies we were obviously aware of Keyport's distribution system, and it was just one of the many assets that contributed to the valuation of the company," says Davey Scoon, CFO, Sun Life ($201 billion in total assets under management).
In addition to Keyport Life, which has about 300,000 policyholders, $19 billion in assets and $718 million in variable annuity sales, Sun Life also will acquire the Independent Financial Marketing Group (Purchase, NY), which provides more than 50 banks with marketing products and had 2000 sales of $3.3 billion. The Keyport acquisition will boost Sun Life's variable annuity sales to $4.6 billion.
Although the exact technological implications of acquiring Keyportwhich Scoon describes as an early insurance player on the Webhaven't yet been fully analyzed from a distribution point of view, according to Scoon, the more up-front technologies, such as sales tools, CRM and email, will be integrated immediately, he says.
"We are going to work on these things right away," says Scoon. "We do know that it will take some time to integrate the two companies. We have effective technological platforms, but they are much different. Therefore, we are not assuming that there will be any immediate coming together of the back offices. The larger back office projects will take some time, and we are going to do that at a pace that is rightand we will do it well."