Sumitomo Life Cleared to Acquire Symetra
January 11, 2016 by Iris Lai, Hong Kong bureau manager: Iris.Lai@ambest.com
TOKYO – Sumitomo Life Insurance Co. has received regulatory approval to acquire Symetra Financial Corp.
Sumitomo Life’s acquisition of Symetra “is not likely to be hazardous or prejudicial to the insurance-buying public of the State of Iowa,” said Nick Gerhart, Insurance Commissioner of Iowa in a statement. Sumitomo Life has no intention of changing Symetra’s business practices and “most, if not all, of current executives and employees of Symetra will remain in their positions.”
Last November, Symetra’s stockholders approved the acquisition by Sumitomo Life. The transaction is expected “to close late in the first quarter or early in the second quarter of 2016,” said Symetra in a statement. Symetra provides employee benefits, annuities and life insurance through a national network of benefits consultants, financial institutions and independent agents and advisers.
Sumitomo Life announced plans to acquire Symetra Financial Corp. for US$3.76 billion in August 2015. Symetra, a major U.S. stop-loss insurer, is to become a wholly owned subsidiary of Sumitomo Life and continue to operate from Bellevue, Washington (Best’s News Service, Aug. 11, 2015).
The Japanese mutual life insurer said the acquisition would enhance its “financial and earnings foundation as it will expand the size of overseas revenues, leading to diversifying the revenue base, and enabling the company to build a well-balanced overseas business portfolio across Asia and the United States.”
Sumitomo Life “had approximately US$228 billion in assets, US$197 billion in policy reserves, approximately 6.8 million customers and approximately 42,000 employees,” as of March 31, 2015, according to the Iowa Commissioner of Insurance. Therefore, the financial condition of Sumitomo Life “will not jeopardize the financial stability of Symetra or prejudice the interests of its policyholders.”
Operating insurance units of Symetra Financial have a current Best’s Financial Strength Rating of A (Excellent).
