Japan-based Sumitomo Life Insurance has signed a merger agreement to acquire US-based insurance firm Symetra Financial, for around $3.8bn.
Under the deal, Sumitomo will pay $32.00 per Symetra share and additional special dividend of $0.50 per share, representing a 32% premium over its average stock price of $24.64 on 5 August.
Sumitomo Life Insurance president and CEO Masahiro Hashimoto said: "We are enthusiastic about the opportunity to acquire Symetra’s dynamic business and believe that a transaction will be mutually beneficial and will create significant value for both Symetra and Sumitomo Life."
Established in 1957 and based in Bellevue of Washington, Symetra offers employee benefits, annuities and life insurance through a national network of benefits consultants, financial institutions and independent agents and advisors.
The company has around $34bn worth assets, 1.7 million customers, and 1,400 employees across the country, as of 30 June this year.
The acquired business will serve as platform for Sumitomo Life to expand its operations in the US.
Symetra’s president and CEO Thomas Marra, along with his current management team, will continue to operate the business with the firm’s current brand, employees, distribution channels and product mix.
Marra said: "We are very pleased to be joining forces with Sumitomo Life, a respected industry leader that has a proven track record of success and shares our deep commitment to business practices that deliver strong value to customers."
Subject to approval of Symetra’s shareholders and regulators, and other customary closing conditions, the deal is expected to complete in the first quarter or early in the second quarter of 2016.
Sumitomo Life operates multi-channel and multi-product life insurance businesses, offering traditional mortality life insurance, nursing care, medical care and retirement plans through sales representatives, insurance outlets, the Internet and bancassurance.
Image: Sumitomo Life Insurance Company headquarters in Osaka, Osaka prefecture, Japan. Photo: courtesy of 663highland.