CHARLOTTE, North Carolina (AP) — Hartford Financial Services Group Inc. said yesterday it will receive a $2.5 billion investment from Allianz SE, a move which may foretell a possible acquisition.

The Hartford, Connecticut-based insurer also predicted a steep third-quarter loss, and said it is cutting its dividend in conjunction with the investment by Allianz. The company lost nearly $9 billion of market value last week as investors cut share price by more than half. Its stock is down 65 percent for the year.

Hartford said Allianz will purchase $750 million in preferred stock at $31 per share that is convertible to common stock. The German financial services firm will also purchase $1.75 billion of 10 percent junior subordinated debentures.

The investment increases the chance that Allianz may acquire all of Hartford Financial, a Citi Investment Research analyst said in a research report.

"Given the size of Hartford's in-force book combined with the slowdown in its recent business production, we have viewed it as ripe for acquisition," analyst Joshua Shanker wrote.