Synchrony Financial shares jump as company sells pet insurance unit

Key takeaways

  • Synchronie Financial announced the sale of its pet insurance unit, Pets Best, to Poodle Holdings.
  • The consumer financial services company said the deal was a combination of cash and equity in Poodle Holdings. subsidiary, Independence Pet Holdings.
  • Synchrony said the deal would provide it with a net-of-tax gain of three-quarters of a billion dollars.

Shares of Synchrony Financial (SYF) jumped as the consumer financial services provider announced it was selling its Pets Best Insurance Services subsidiary to Poodle Holdings.

The company said in a regulatory filing that it will receive a combination of cash and equity interests in Poodle Holdings'; subsidiary, Independence Pet Holdings, in exchange for the pet insurance unit.

Synchrony said the The deal is expected to generate a gain, net of taxes, of $750 million. The company noted that the total could change “depending on the carrying value of Pets Best's net assets and the final valuation of the consideration receivable at closing.”

Synchrony acquired Pets Best in March 2019 and #39; placed under the CareCredit umbrella, saying the move would allow CareCredit “to offer a comprehensive suite of payment options to veterinarians and pet owners to help animals to access the care they need.

At the time, CareCredit's then-CEO Beto Casellas explained that more and more people were “including pets as part of their family,” and the addition of Pets Best gives the company a “unique insight into the rapidly growing pet health insurance market.”

The transaction should be completed by first quarter of next year.

Despite Tuesday Up 5%, Synchrony Financial shares are in negative territory for the year.


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