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.
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.
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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.