American Economical Group, Inc. Announces Arrangement to Market its Annuity Company to MassMutual for $3.5 Billion

CINCINNATI–(Business WIRE)–Jan 27, 2021–

American Money Team, Inc. (NYSE: AFG) announced today that it has entered into a definitive settlement to provide its Annuity enterprise to Massachusetts Mutual Lifestyle Coverage Organization (MassMutual) for $3.5 billion in dollars, issue to final closing adjustments to the extent that GAAP shareholders’ fairness excluding accumulated other comprehensive income of the entities marketed may differ from $2.8 billion.

Under the conditions of the settlement, which is anticipated to shut in the 2nd quarter of 2021, MassMutual will purchase Excellent American Existence Coverage Corporation (GALIC) and its two coverage subsidiaries, Annuity Traders Life Insurance plan Business and Manhattan Nationwide Life Insurance policy Enterprise. At December 31, 2020, GALIC and its subsidiaries had close to $40 billion of standard fixed and indexed annuity reserves. AFG expects to understand an soon after-tax acquire 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 obtain around $500 million in authentic estate-associated partnerships and instantly owned real estate from GALIC.

S. Craig Lindner, AFG’s Co-Chief Govt Officer, commented, “This transaction provides an exceptional chance for GALIC and MassMutual to be one particular of the leading vendors of regular set and indexed annuities in key distribution channels and marketplaces. In reality, MassMutual has amongst the best insurance policies fiscal toughness scores, which we feel will result in improved distributor recruitment and policyholder retention. MassMutual’s dedication to build a subsidiary in Cincinnati assures that the arrangement will have no affect on GALIC’s associations with and commitments to its annuity policyholders and distribution associates. Importantly, we are extremely pleased that this transaction will present compelling vocation chances for our annuity associates, and convey the functions of a properly-revered insurance company to the Better Cincinnati organization community.”

Mr. Lindner ongoing, “As Co-CEOs, Carl and I perspective capital administration as 1 of our most important priorities. AFG’s funds and liquidity will be drastically increased as a outcome of the transaction. With a sturdy stability sheet and considerable excess money, we will carry on to appraise opportunities for deploying AFG’s extra funds, together with the probable for healthy, successful natural growth, expansion of our Specialty Home & Casualty specialized niche businesses by way of acquisitions and start out-ups that satisfy our goal return thresholds, as very well as share repurchases and special dividends.”

Roger Crandall, Chairman, President and CEO, MassMutual commented: “With MassMutual’s enduring financial toughness, broad financial commitment abilities and end-to-close electronic encounter, we will build on the excellent leadership posture that the proficient and dedicated Excellent American Lifetime workforce has crafted over generations, enabling us to help even a lot more people safe their long run and defend the types they appreciate.”

Skadden, Arps, Slate, Meagher & Flom LLP and Keating Muething & Klekamp PLL are acting as lawful advisors to AFG. Debevoise & Plimpton LLP is performing as legal advisor to MassMutual.

About American Financial Team, Inc.

American Economical Team is an insurance keeping corporation, primarily based in Cincinnati, Ohio. Via the functions of Wonderful American Coverage Group, AFG is engaged primarily in home and casualty insurance, concentrating on specialized industrial products and solutions for firms, and in the sale of classic preset and indexed annuities in the retail, financial institutions, broker-dealer, and registered expense advisor marketplaces. Fantastic American Insurance policy Group’s roots go back again to 1872 with the founding of its flagship business, Fantastic American Coverage Firm.

About MassMutual

MassMutual is a top mutual lifestyle insurance coverage company that is operate for the profit of its users and taking part policyowners. Started in 1851, the corporation has been constantly guided by a person steady objective: we enable people today protected their future and defend the kinds they enjoy. With a target on delivering prolonged-phrase benefit, MassMutual provides a wide variety of safety, accumulation, wealth administration and retirement items and providers.

Ahead On the lookout Statements

This press release consists of sure statements that may possibly be deemed to be “forward-on the lookout statements” in just the indicating of Section 27A of the Securities Act of 1933 and Portion 21E of the Securities Exchange Act of 1934. All statements in this press release not working with historic final results are ahead-seeking and are dependent on estimates, assumptions and projections. Examples of this kind of forward-on the lookout statements include statements relating to: the Company’s anticipations about industry and other conditions and their influence on long term rates, revenues, earnings, expenditure things to do and the sum and timing of share repurchases recoverability of asset values predicted losses and the adequacy of reserves for asbestos, environmental pollution and mass tort statements amount changes and enhanced reduction working experience.

Actual effects and/or fiscal situation could vary materially from those people contained in or implied by these kinds of forward-on the lookout statements for a wide variety of motives including, but not confined to: that AFG may be not able to comprehensive the proposed transaction simply because, amongst other good reasons, disorders to the closing of the proposed transaction could not be happy or waived, uncertainty as to the timing of completion of the proposed transaction, failure to understand the predicted positive aspects from the proposed transaction, alterations in monetary, political and financial conditions, together with alterations in curiosity and inflation fees, currency fluctuations and prolonged economic recessions or expansions in the U.S. and/or abroad performance of securities marketplaces, including the price of equity index options new laws or declines in credit score good quality or credit rating scores that could have a materials influence on the valuation of securities in AFG’s financial investment portfolio the availability of money modifications in insurance policy legislation or regulation, which includes modifications to cash specifications the results of the COVID-19 outbreak, including the outcomes on the worldwide and national financial system and credit marketplaces, legislative or regulatory developments affecting the insurance coverage business, quarantines or other vacation or wellbeing-linked limitations variations in the legal atmosphere impacting AFG or its buyers tax regulation and accounting alterations concentrations of all-natural catastrophes and intense temperature, terrorist routines (like any nuclear, biological, chemical or radiological events), incidents of war or losses resulting from pandemics, civil unrest and other major losses disruption prompted by cyber-assaults or other technological know-how breaches or failures by AFG or its enterprise companions and services companies, which could negatively effect AFG’s business enterprise and/or expose AFG to litigation growth of insurance plan loss reserves and establishment of other reserves, specially with respect to amounts affiliated with asbestos and environmental claims availability of reinsurance and capacity of reinsurers to pay their obligations trends in persistency and mortality aggressive pressures the capacity to acquire satisfactory charges and policy phrases adjustments in AFG’s credit rating scores or the economical energy ratings assigned by main scores businesses to AFG’s operating subsidiaries the influence of the problems in the worldwide economic marketplaces and the worldwide financial system relating to AFG’s international operations and other elements recognized in AFG’s filings with the Securities and Trade Commission.

The forward-seeking statements herein are created only as of the date of this push release. The Organization assumes no obligation to publicly update any forward-hunting statements.

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Get hold of: Diane P. Weidner, IRC

Vice President – Investor & Media Relations

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Market Key phrase: Skilled Companies Insurance coverage FINANCE

Resource: American Economical Group, Inc.

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PUB: 01/27/2021 05:00 PM/DISC: 01/27/2021 05:00 PM