Germany's Hannover Re AG (HNR1.XE), one of the five largest reinsurers worldwide, Friday said it is buying a U.S. individual life reinsurance portfolio from reinsurer Scottish Re (SKRRF) in a reinsurance and asset purchase transaction.

As part of the transaction, Hannover Re will also buy policy administration systems from Scottish Re, and other assets supporting the U.S. life reinsurance business.

Hannover Re said it won't need external funding to complete the transaction, that the acquisition of the portfolio will be net-profit accretive from 2009 and that the transaction is expected to close in the first quarter.

The U.S. life reinsurance portfolio, dubbed ING Business, was originally bought by Scottish Re from ING Groep NV (ING) in a reinsurance transaction effective Dec. 31, 2004.

In 2009, this business is expected to generate a premium volume of around $1.2 billion and will result in Hannover Re moving up to the number five position in terms of individual life reinsurance in-force in the U.S., it said.

"This is a transformational step for our global life reinsurance ambitions," said Hannover Re Chief Executive Wilhelm Zeller. "It contributes a large block of business in force, together with industry-leading capabilities in mortality research, pricing, underwriting and reinsurance administration which will substantially increase our presence and earnings from the U.S. mortality risk market ..."

Company Web site: www.hannover-re.com

-By Ulrike Dauer, Dow Jones Newswires; +49 69 29725 500; ulrike.dauer@dowjones.com

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