Travelers to sell Canadian personal, commercial insurance units for $2.4B

The Travelers Companies (TRV) on Tuesday announced that it has signed a definitive agreement to sell the personal insurance business and the majority of the commercial insurance business of Travelers Canada to Definity Financial Corporation (DFY.TO) for approximately $2.4B. The purchase price represents a multiple of 1.8 times book value, adjusting for approximately $800M of excess local capital which is being repatriated as part of this transaction in a tax-efficient manner. Travelers will retain its premier Canadian surety business. The transaction is expected to close in the first quarter of 2026, subject to regulatory approvals and other customary closing conditions. “This transaction is a reflection of our steadfast commitment to disciplined capital allocation and long-term value creation,” said Alan Schnitzer, Chairman and CEO of Travelers. “The evolution of the Canadian market over the past decade has made Definity a natural long-term owner for this business, a view affirmed by the compelling value of their proposal. I am confident that our Canadian customers, brokers and colleagues will benefit from being part of one of the country’s leading and fully integrated property casualty insurers.” Travelers expects to use approximately $700M of the net cash proceeds of the transaction for additional share repurchases in 2026, while retaining the remainder to support ongoing operations and for general corporate purposes. The transaction and resulting share repurchases are expected to be slightly accretive to the company’s earnings per share in each of the next several years. Jefferies LLC acted as financial advisor and Skadden, Arps, Slate, Meagher & Flom LLP and Stikeman Elliott LLP served as legal advisors to Travelers in this transaction.