ING Cuts Stake in Voya Financial, Selling 34.5 Million Shares for $1.4 Billion
November 14, 2014 by Thomas Harman
AMSTERDAM – ING Group has agreed to sell 34.5 million shares of Voya Financial Inc. common stock for $1.4 billion as part of an underwritten public offering. As part of the deal, Voya is repurchasing nearly 4.5 million of its common stock shares from ING.
The sale cuts ING ‘s stake of Voya from 32.5% to about 19%, ING said in a statement.
A syndicate of underwriters paid $39.15 per share in its repurchase of 30,030,013 shares. In connection with the public offering, Voya repurchased 4,469,987 shares of its common stock for $175 million, Voya said in a statement. Voya will not be issuing or selling common stock and will not receive any proceeds from the offering.
The sale is the latest in a series of similar transactions by ING, which received European Union aid after taking heavy financial losses on U.S. mortgage-backed securities in the housing crisis. As a condition of that aid, the European Union required ING Group to dispose of its insurance assets — including Voya Financial — entirely by 2016.
ING Group’s initial public offering on its U.S. retirement, investments and insurance business, resulted in the creation of ING U.S., which went public in May 2013 and was re-branded as Voya Financial. After Voya was created, ING Group owned 71% of Voya and has since made stock sales that reduced its ownership from 71%-57% in October 2013, from 57% to 43% in March 2014 and from 43% to 32% in September 2014 (Best’s News Service, Sept. 3, 2014).
Voya communications director Christopher Breslin said his company is buying back some of the stock being sold by ING because Voya has been generating excess capital. “We’re using a bit of it now for buybacks and have been over the course of this year,” Breslin told Best’s News Service.
Including this latest buyback, Voya in 2014 will have bought back about 21.2 million shares of its own common stock — most repurchased directly from the ING Group — at an estimated $789 million, Breslin said.
On the afternoon of Nov. 13, Voya Financial stock (NYSE: VOYA) was trading at $39.29 per share — down 1.74% from the previous close. ING Group (NYSE: ING) was trading at $13.85 — up 0.82% from the previous close.
Voya Financial Group subsidiaries currently have a Best’s Financial Strength Rating of A (Excellent).
