Prosperity Life Insurance Group (Prosperity) has entered into a definitive agreement to acquire SBLI USA Mutual Life Insurance Company (SBLI USA), through a sponsored demutualization.

Further terms of the agreement have not been revealed.

Following the completion of transaction, SBLI will operate as a subsidiary of Prosperity and the integrated entity will have more than $3bn of combined assets within its insurance company subsidiaries.

Pending regulatory approval and satisfying customary closing conditions, the agreement is expected to complete during the third quarter of 2013.

SBLI will remain operating from its Manhattan corporate headquarters and continue to maintain the same commitment to community outreach.

Commenting on the transaction, Prosperity chairman Jay Novik said the acquisition will boost its presence in the New York marketplace.

Prosperity, which was established in 2010 by Reservoir Capital Group and Black Diamond Capital Partners, operates as a life insurance holding company.

SBLI manages $12.5bn of insurance in-force, approximately $1.5bn in assets, and more than 250,000 policies, to date.