8-KAcquisitions & DispositionsMaterial AgreementsOther Events+1

ALLSTATE CORP 8-K Report, Material Agreement (Apr 7, 2014)

Filed April 7, 2014For Securities:ALLALL-PJALL-PBALL-PHALL-PI

Summary

Allstate Corporation (ALL) filed an 8-K on April 7, 2014, to report on the completion of the sale of its subsidiary, Lincoln Benefit Life Company (Lincoln), to Resolution Life, Inc. This transaction, initially agreed upon in July 2013, was finalized on April 1, 2014, for cash consideration of $587 million, subject to post-closing adjustments. As part of the sale, Allstate Life Insurance Company entered into an Amended and Restated Reinsurance Agreement and a Partial Commutation Agreement with Lincoln. The Reinsurance Agreement ensures that Allstate Life will continue to reinsure certain life insurance policies sold through its agency channel, variable annuities, and immediate annuities previously underwritten by Lincoln. Concurrently, the Partial Commutation Agreement addresses the commutation of reinsurance for specific Lincoln business lines, including fixed deferred annuities, business written through independent producers, and accident and health/long-term care insurance. The filing also includes unaudited pro forma consolidated financial statements as of and for the year ended December 31, 2013, reflecting the impact of the Lincoln sale. Investors should review these pro forma statements to understand the company's financial position and results of operations post-divestiture. The event was also accompanied by a press release.

Key Highlights

  • 1Allstate Corp completed the sale of its subsidiary, Lincoln Benefit Life Company, on April 1, 2014.
  • 2The sale price was $587 million in cash, subject to post-closing adjustments.
  • 3The transaction involved the execution of an Amended and Restated Reinsurance Agreement with the divested subsidiary.
  • 4A Partial Commutation Agreement was also entered into, modifying existing reinsurance arrangements.
  • 5The Reinsurance Agreement covers life policies sold via Allstate's agency channel and certain annuity and life business.
  • 6The filing includes unaudited pro forma financial statements giving effect to the sale.
  • 7A press release was issued on April 1, 2014, to announce the completion of the sale.

Frequently Asked Questions

This 8-K filing was primarily made to report the completion of the sale of Allstate Corporation's subsidiary, Lincoln Benefit Life Company, to Resolution Life, Inc., and to disclose the related material definitive agreements.

The sale generated $587 million in cash for Allstate, subject to post-closing adjustments. The filing also includes pro forma financial statements that provide an adjusted view of Allstate's financial position and operations as if the sale had occurred earlier.

The Reinsurance Agreement ensures Allstate Life continues to reinsure life insurance policies sold through its agency channel, variable annuities previously retroceded, and immediate annuities written by Lincoln. The Partial Commutation Agreement commuted reinsurance for Lincoln's fixed deferred annuity, value-adjusted deferred annuity, and indexed deferred annuity business, as well as certain life insurance business sold through independent producers and accident/health/long-term care insurance.

The sale of Lincoln Benefit Life Company officially closed on April 1, 2014.