American to buy USLife
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February 13, 1997: 6:49 a.m. ET
$1.8 billion deal will boost American General to third largest insurer
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NEW YORK (CNNfn) - American General Corp. said Thursday it has a definitive agreement to acquire life-insurer USLife Corp. in an stock deal worth $1.8 billion.
American General, a Houston-based financial-service company, will also assume as much as $600 million of USLife's debt.
Under the terms of the pact, USLife shareholders will receive $49 worth of American General stock for each USLife share, American General said.
The company said the deal will be tax-free to USLife shareholders and is expected to be non-dilutive.
The life insurance sector has grown increasingly tight as competition from banks and securities firms increases.
USLife is one of the nation's 25 largest insurers and the proposed combination would boost American General from fifth place to third in the United States.
USLife will add about $8 billion in assets to American General. American General is in the process of finishing last year's $665 million acquisition of Home Beneficial Corp., Richmond, Va.
The combined entity would have assets of $74 billion and 1996 earnings of $757 million in $9 billion in revenues, American General said.
American General shares closed up 7/8 at 41-1/2 Wednesday while USLife shares closed up 1/4 at 41-3/4.
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American General
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