Business lender CIT Group Inc. agreed to sell its student-lending business to Nelnet Inc., which is buying the federal family education loans and related assets for $3.6 billion.
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The deal, which both companies announced in separate filings with the Securities and Exchange Commission, include $2.6 billion of securitized student loans and related assets under a stock-purchase agreement, and about $950 million of unsecuritized student loans.
Nelnet, an education loan provider, said it expects the deal will close later in April. The acquisition will increase the company's student loan portfolio to more than $29 billion.
CIT Group, meanwhile, said it expects to receive a cash payment of about $1.1 billion, the majority of which will be used to repay existing debt secured by student loans. The company expects to record a gain in the second quarter related to the sale and the extinguishment of the debt.
Shares of both CIT and Nelnet were roughly flat in after-hours trading.