CINCINNATI–(Organization WIRE)–Jan 27, 2021–
American Economic Group, Inc. (NYSE: AFG) declared nowadays that it has entered into a definitive agreement to sell its Annuity small business to Massachusetts Mutual Existence Insurance policies Organization (MassMutual) for $3.5 billion in dollars, subject matter to remaining closing adjustments to the extent that GAAP shareholders’ fairness excluding accumulated other complete income of the entities bought differs from $2.8 billion.
Underneath the phrases of the settlement, which is predicted to close in the 2nd quarter of 2021, MassMutual will purchase Good American Daily life Insurance plan Enterprise (GALIC) and its two insurance policy subsidiaries, Annuity Traders Life Insurance policies Company and Manhattan Nationwide Lifetime Insurance policies Business. At December 31, 2020, GALIC and its subsidiaries experienced roughly $40 billion of traditional mounted and indexed annuity reserves. AFG expects to realize an soon after-tax obtain on the sale of $620 million to $690 million ($7.10 to $7.90 per AFG share) upon closing. Prior to completion of the transaction, AFG will purchase about $500 million in true estate-related partnerships and immediately owned actual estate from GALIC.
S. Craig Lindner, AFG’s Co-Main Government Officer, commented, “This transaction presents an superb opportunity for GALIC and MassMutual to be a person of the top suppliers of regular set and indexed annuities in key distribution channels and markets. In point, MassMutual has among the highest insurance coverage money strength scores, which we feel will consequence in enhanced distributor recruitment and policyholder retention. MassMutual’s motivation to build a subsidiary in Cincinnati makes sure that the arrangement will have no influence on GALIC’s associations with and commitments to its annuity policyholders and distribution partners. Importantly, we are really pleased that this transaction will give persuasive career options for our annuity associates, and provide the operations of a nicely-highly regarded insurance provider to the Greater Cincinnati business group.”
Mr. Lindner ongoing, “As Co-CEOs, Carl and I watch money administration as just one of our most important priorities. AFG’s funds and liquidity will be considerably increased as a end result of the transaction. With a sturdy equilibrium sheet and significant excessive cash, we will proceed to appraise alternatives for deploying AFG’s excess funds, together with the opportunity for healthier, lucrative natural and organic growth, enlargement of our Specialty Home & Casualty market enterprises via acquisitions and begin-ups that meet our goal return thresholds, as perfectly as share repurchases and special dividends.”
Roger Crandall, Chairman, President and CEO, MassMutual commented: “With MassMutual’s enduring money toughness, wide financial commitment abilities and close-to-conclusion digital working experience, we will establish on the remarkable management placement that the proficient and committed Great American Lifetime staff has constructed more than generations, enabling us to assistance even additional men and women protected their upcoming and guard the ones they enjoy.”
Skadden, Arps, Slate, Meagher & Flom LLP and Keating Muething & Klekamp PLL are performing as legal advisors to AFG. Debevoise & Plimpton LLP is performing as lawful advisor to MassMutual.
American Economical Group is an insurance plan holding enterprise, based mostly in Cincinnati, Ohio. By the operations of Fantastic American Insurance policy Team, AFG is engaged primarily in home and casualty insurance policies, concentrating on specialized commercial products and solutions for enterprises, and in the sale of classic fastened and indexed annuities in the retail, financial institutions, broker-dealer, and registered expense advisor marketplaces. Wonderful American Insurance policies Group’s roots go back again to 1872 with the founding of its flagship enterprise, Good American Insurance Business.
MassMutual is a primary mutual lifestyle coverage corporation that is run for the advantage of its users and collaborating policyowners. Launched in 1851, the enterprise has been regularly guided by a person constant purpose: we aid people secure their long term and protect the types they appreciate. With a concentrate on providing long-expression value, MassMutual provides a wide vary of protection, accumulation, prosperity administration and retirement solutions and services.
Forward Searching Statements
This press launch includes particular statements that may be considered to be “forward-looking statements” within just the which means of Area 27A of the Securities Act of 1933 and Portion 21E of the Securities Trade Act of 1934. All statements in this press release not dealing with historic success are ahead-seeking and are based on estimates, assumptions and projections. Examples of this sort of forward-on the lookout statements include statements relating to: the Company’s anticipations regarding industry and other problems and their influence on potential rates, revenues, earnings, financial commitment routines and the quantity and timing of share repurchases recoverability of asset values envisioned losses and the adequacy of reserves for asbestos, environmental pollution and mass tort claims fee variations and enhanced reduction working experience.
Actual success and/or economic condition could differ materially from people contained in or implied by these forward-searching statements for a wide range of motives such as, but not constrained to: that AFG may well be not able to finish the proposed transaction for the reason that, among other causes, disorders to the closing of the proposed transaction may well not be satisfied or waived, uncertainty as to the timing of completion of the proposed transaction, failure to know the anticipated advantages from the proposed transaction, modifications in economic, political and economic disorders, like improvements in interest and inflation prices, currency fluctuations and prolonged economic recessions or expansions in the U.S. and/or abroad effectiveness of securities marketplaces, including the price tag of fairness index selections new laws or declines in credit rating high quality or credit rating ratings that could have a substance affect on the valuation of securities in AFG’s investment decision portfolio the availability of funds modifications in insurance policy regulation or regulation, such as modifications to capital prerequisites the outcomes of the COVID-19 outbreak, which include the outcomes on the global and nationwide overall economy and credit rating marketplaces, legislative or regulatory developments influencing the insurance policy sector, quarantines or other vacation or health and fitness-related constraints improvements in the lawful natural environment impacting AFG or its prospects tax legislation and accounting alterations ranges of pure catastrophes and critical climate, terrorist things to do (together with any nuclear, organic, chemical or radiological occasions), incidents of war or losses ensuing from pandemics, civil unrest and other important losses disruption prompted by cyber-attacks or other technological know-how breaches or failures by AFG or its enterprise companions and support providers, which could negatively influence AFG’s company and/or expose AFG to litigation growth of coverage decline reserves and establishment of other reserves, specially with respect to amounts associated with asbestos and environmental claims availability of reinsurance and skill of reinsurers to pay their obligations developments in persistency and mortality aggressive pressures the capability to get hold of satisfactory fees and plan terms improvements in AFG’s credit rating rankings or the monetary power rankings assigned by key ratings organizations to AFG’s running subsidiaries the effect of the circumstances in the global economical marketplaces and the international financial system relating to AFG’s intercontinental operations and other things recognized in AFG’s filings with the Securities and Exchange Fee.
The ahead-searching statements herein are produced only as of the date of this press release. The Business assumes no obligation to publicly update any forward-hunting statements.
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Keyword: MASSACHUSETTS OHIO UNITED STATES NORTH The united states
Marketplace Key word: Skilled Products and services Insurance policy FINANCE
Source: American Fiscal Team, Inc.
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PUB: 01/27/2021 05:00 PM/DISC: 01/27/2021 05:00 PM