GE Capital to Buy Colonial Penn

GE Capital said it agreed to acquire Colonial Penn P&C; Group from Leucadia National Corp. for $950 million in cash, a move that would put it on the road to direct marketing of personal auto insurance. GE Capital, known for its large reinsurance and life insurance holdings, said Norristown, Pa.-based Colonial Penn would become a subsidiary of its Richmond, Va.-based Consumer Savings & Insurance Group. However, GE Capital, a subsidiary of Fairfield, Conn.-based General Electric Co., said it would keep the management and operational platform of Colonial Penn, a fast-growing, low-cost direct marketer of auto insurance. Leucadia National said it expects to report a pretax gain of about $600 million upon completion of the sale of Colonial Penn, which is subject to shareholder and regulatory approval. GE shares lost 19 cents to close at $65, while Leucadia shares rose 94 cents to close at $30.94. Both trade on the NYSE.