Summary
The Hartford Financial Services Group, Inc. (HIG) filed this 8-K on August 9, 2013, to announce a significant divestiture and related financial statement revisions. The company has entered into a definitive agreement to sell its indirect wholly-owned subsidiary, Hartford Life International, Ltd. (HLIL), to Columbia Insurance Company, a Berkshire Hathaway company, for approximately $285 million. This transaction, expected to close by year-end 2013, is classified as a cash sale and resulted in a net loss of approximately $102 million in the second quarter of 2013. HLIL's primary asset is its subsidiary, Hartford Life Limited, which previously sold variable annuities in the U.K. As a result of this sale, The Hartford is revising several sections of its 2012 Annual Report on Form 10-K. These revisions are to reflect the reclassification of its U.K. variable annuity business as discontinued operations and to incorporate the retrospective adoption of new accounting standards related to offsetting assets and liabilities as of January 1, 2013. Investors should note that this filing does not amend or restate the original 2012 10-K but provides updated information for these specific business segments and accounting treatments. For the most current financial performance, investors should refer to the company's Form 10-Q filings for the periods ended March 31, 2013, and June 30, 2013.
Key Highlights
- 1The Hartford is selling its U.K. variable annuity business (Hartford Life International, Ltd.) to Columbia Insurance Company (a Berkshire Hathaway company) for approximately $285 million.
- 2The sale resulted in a net loss of approximately $102 million recognized in the second quarter of 2013.
- 3The U.K. variable annuity business is being reclassified as discontinued operations in the revised 2012 Form 10-K filings.
- 4The company is retrospectively adopting new accounting standards (ASU 2011-11 and ASU 2013-01) related to disclosures about offsetting assets and liabilities, effective January 1, 2013.
- 5This 8-K filing provides revised sections of the 2012 Form 10-K, not an amendment or restatement of the entire report.
- 6The transaction is expected to close by the end of 2013, subject to customary closing conditions and regulatory approvals.
- 7Investors should consult subsequent Form 10-Q filings for the most up-to-date financial information.