American Financial Team, Inc. Announces Settlement to Sell its Annuity Small business to MassMutual for $3.5 Billion

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

American Economical Group, Inc. (NYSE: AFG) announced nowadays that it has entered into a definitive settlement to promote its Annuity business enterprise to Massachusetts Mutual Lifestyle Insurance policies Company (MassMutual) for $3.5 billion in hard cash, subject matter to ultimate closing adjustments to the extent that GAAP shareholders’ equity excluding accrued other comprehensive revenue of the entities marketed differs from $2.8 billion.

Underneath the phrases of the agreement, which is expected to close in the next quarter of 2021, MassMutual will acquire Terrific American Life Insurance coverage Business (GALIC) and its two coverage subsidiaries, Annuity Buyers Everyday living Insurance plan Company and Manhattan Nationwide Daily life Insurance policy Company. At December 31, 2020, GALIC and its subsidiaries experienced roughly $40 billion of classic set and indexed annuity reserves. AFG expects to recognize an after-tax acquire on the sale of $620 million to $690 million ($7.10 to $7.90 for each AFG share) upon closing. Prior to completion of the transaction, AFG will receive close to $500 million in genuine estate-linked partnerships and immediately owned real estate from GALIC.

S. Craig Lindner, AFG’s Co-Main Government Officer, commented, “This transaction offers an excellent chance for GALIC and MassMutual to be a single of the leading vendors of conventional fixed and indexed annuities in important distribution channels and marketplaces. In fact, MassMutual has among the the best insurance policy financial strength ratings, which we believe that will consequence in improved distributor recruitment and policyholder retention. MassMutual’s dedication to create a subsidiary in Cincinnati assures that the arrangement will have no affect on GALIC’s relationships with and commitments to its annuity policyholders and distribution associates. Importantly, we are really pleased that this transaction will offer powerful occupation prospects for our annuity associates, and convey the operations of a properly-highly regarded insurance provider to the Better Cincinnati company group.”

Mr. Lindner continued, “As Co-CEOs, Carl and I look at capital administration as just one of our most crucial priorities. AFG’s capital and liquidity will be considerably improved as a result of the transaction. With a solid stability sheet and sizeable excess money, we will keep on to appraise opportunities for deploying AFG’s excess cash, which includes the opportunity for healthier, rewarding natural expansion, growth of our Specialty Residence & Casualty specialized niche firms by way of acquisitions and start out-ups that meet up with our concentrate on return thresholds, as well as share repurchases and special dividends.”

Roger Crandall, Chairman, President and CEO, MassMutual commented: “With MassMutual’s enduring economical energy, wide financial investment capabilities and close-to-end digital knowledge, we will build on the excellent leadership placement that the talented and committed Great American Existence crew has created above generations, enabling us to assist even far more men and women protected their long term and guard the ones they adore.”

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

About American Economic Group, Inc.

American Monetary Group is an insurance policies holding firm, primarily based in Cincinnati, Ohio. As a result of the functions of Terrific American Insurance policy Group, AFG is engaged principally in house and casualty insurance policy, concentrating on specialised industrial goods for corporations, and in the sale of classic set and indexed annuities in the retail, fiscal institutions, broker-dealer, and registered investment decision advisor markets. Great American Insurance policy Group’s roots go back again to 1872 with the founding of its flagship enterprise, Wonderful American Insurance policy Corporation.

About MassMutual

MassMutual is a main mutual existence insurance policies organization that is operate for the benefit of its members and participating policyowners. Established in 1851, the enterprise has been continually guided by a single steady goal: we help individuals protected their long run and guard the ones they enjoy. With a concentration on providing prolonged-expression price, MassMutual presents a vast selection of protection, accumulation, prosperity administration and retirement merchandise and products and services.

Ahead Hunting Statements

This push release has sure statements that may perhaps be deemed to be “forward-wanting statements” within just the meaning of Area 27A of the Securities Act of 1933 and Portion 21E of the Securities Exchange Act of 1934. All statements in this push release not working with historic success are forward-looking and are dependent on estimates, assumptions and projections. Illustrations of this kind of ahead-seeking statements contain statements relating to: the Company’s anticipations regarding sector and other disorders and their influence on potential premiums, revenues, earnings, expenditure things to do and the sum and timing of share repurchases recoverability of asset values envisioned losses and the adequacy of reserves for asbestos, environmental air pollution and mass tort promises charge changes and improved reduction encounter.

Genuine results and/or economic affliction could differ materially from these contained in or implied by these types of forward-hunting statements for a variety of causes which includes, but not constrained to: that AFG may perhaps be unable to entire the proposed transaction due to the fact, among the other explanations, circumstances to the closing of the proposed transaction might not be glad or waived, uncertainty as to the timing of completion of the proposed transaction, failure to notice the anticipated advantages from the proposed transaction, changes in money, political and economic conditions, including alterations in interest and inflation premiums, currency fluctuations and prolonged economic recessions or expansions in the U.S. and/or overseas effectiveness of securities markets, including the charge of equity index possibilities new legislation or declines in credit rating top quality or credit rating ratings that could have a product effects on the valuation of securities in AFG’s expense portfolio the availability of money adjustments in insurance plan regulation or regulation, together with modifications to money requirements the effects of the COVID-19 outbreak, which includes the outcomes on the worldwide and countrywide economic climate and credit score marketplaces, legislative or regulatory developments influencing the insurance policies field, quarantines or other travel or well being-linked limitations adjustments in the legal setting affecting AFG or its shoppers tax law and accounting alterations levels of pure catastrophes and intense weather conditions, terrorist functions (which includes any nuclear, biological, chemical or radiological gatherings), incidents of war or losses resulting from pandemics, civil unrest and other main losses disruption caused by cyber-assaults or other engineering breaches or failures by AFG or its enterprise associates and services vendors, which could negatively influence AFG’s small business and/or expose AFG to litigation improvement of insurance reduction reserves and institution of other reserves, particularly with regard to quantities affiliated with asbestos and environmental claims availability of reinsurance and ability of reinsurers to pay out their obligations tendencies in persistency and mortality aggressive pressures the means to get sufficient prices and coverage conditions improvements in AFG’s credit score scores or the economic power scores assigned by significant scores organizations to AFG’s functioning subsidiaries the effects of the circumstances in the worldwide fiscal markets and the international economic system relating to AFG’s intercontinental operations and other components determined in AFG’s filings with the Securities and Exchange Commission.

The forward-looking statements herein are produced only as of the date of this push launch. The Organization assumes no obligation to publicly update any forward-seeking statements.

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Call: Diane P. Weidner, IRC

Vice President – Investor & Media Relations

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Industry Key phrase: Qualified Services Insurance FINANCE

Resource: American Money Group, Inc.

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