NORTHBROOK, Ill., Aug. 13, 2024 – Allstate Corporation (NYSE: ALL) announced a definitive agreement to sell its Employer Voluntary Benefits business to StanCorp Financial Group, Inc., (The Standard) for $2.0 billion. The sale represents the first step in a strategic decision to allow Allstate Health & Benefits' three businesses – Employer Voluntary Benefits, Individual and Group Health – to realize their full growth potential by combining them with more powerful companies.
Tom Wilson, Chairman, President and CEO of The Allstate Corporation:
“Allstate's Employer Voluntary Benefits business provides coverage to more than 3.5 million customers who will continue to be well served by The Standard. The alignment between Allstate's industry-leading products, employer relations, distribution and talent team and The Standard's group benefits business will provide customers with comprehensive protection and superior value. Allstate agents will now offer a wider range of options to customers under a five-year exclusive distribution plan. Allstate shareholders will also benefit as the money is used to increase market share in personal loans and expand coverage offerings. Negotiations on the sale of the individual business and the health group are ongoing and are expected to achieve similar success. “
Dan McMillan, President and CEO of The Standard:
“We see a significant synergy between Allstate's leading voluntary health products and The Standard's expertise in workplace benefits. This acquisition enhances our program of offerings for customers of all sizes. We look forward to welcoming talented Allstate Employer Voluntary Benefits employees to The Standard and to a profitable distribution relationship as we move forward.”
Transaction summary
Allstate will sell its voluntary employer benefits subsidiaries to The Standard for $2.0 billion, adjusted for balance sheet closing, and subject to customary closing conditions and approvals. In the first half of 2024, these businesses had revenue of $535 million, Adjusted Income of $45 million, and net cash and surplus of $255 million.
“This sale is expected to generate approximately $600 million in revenue and increase operating income by $1.6 billion,” said Jess Merten, Allstate's Chief Financial Officer. “Adjusted return on equity will decrease by 100 basis points after the sale, which is expected in the first half of 2025.”
Investors
Allstate will host a conference call and webcast at 9 a.m. Eastern on Wednesday, Aug. 14 to discuss this work. The investor webcast can be accessed at www.allstateinvestors.com. Playback will be posted soon.
Counselors
JP Morgan and Ardea Partners acted as financial advisors and Wilkie Farr & Gallagher LLP acted as legal counsel to Allstate. Citi is acting as exclusive financial advisor and Debevoise & Plimpton is acting as legal advisor to The Standard.
Financial information, including material announcements relating to Allstate Corporation, is posted regularly at www.allstateinvestors.com.
About Allstate
Allstate Corporation (NYSE: ALL) protects people from life's uncertainties with a comprehensive array of auto, home, appliance, and identity theft protection. Products are available through an extensive distribution network including Allstate agents, independent agents, major retailers, online, and in-store. Allstate is widely known by the slogan “You're in Good Hands with Allstate.” For more information, visit www.allstate.com.
About the Level
Standard is a family of companies dedicated to helping clients achieve financial well-being and peace of mind. In business since 1906, we are a leading provider of financial protection products and services to employers and individuals. Our products include group and individual disability insurance, group life and accidental death and separation insurance, group dental and group vision insurance, voluntary and supplemental benefits, absence management and paid family leave services, retirement plan products and services and individual income. For more information about The Standard, visit standard.com and follow us on LinkedIn.
Standard is the marketing name of StanCorp Financial Group, Inc., and its subsidiaries: Standard Insurance Company, The Standard Life Insurance Company of New York, Standard Retirement Services, StanCorp Mortgage Investors, StanCorp Investment Advisers, StanCorp Real Estate, StanCorp Equities, The -Anthem Life Insurance Company, Anthem Life & Disability Insurance Company and Greater Georgia Life Insurance Company.
Financial information, including material announcements relating to Allstate Corporation, is posted regularly at www.allstateinvestors.com.
Forward-looking statements
This news release contains “forward-looking statements” that anticipate results based on our estimates, assumptions and plans that are subject to uncertainty. These statements are made subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements do not necessarily relate to historical or current facts and can be identified by their use of words such as “plans,” “intends,” “expects,” “will,” “should,” “expects,” “estimates,” “intends,” “believes ,” “possible,” “intended” and other words with similar meanings. We believe these statements are based on reasonable estimates, assumptions, and plans. However, if the estimates, assumptions, or plans underlying the forward-looking statements prove to be inaccurate or if other risks or uncertainties arise, actual results may differ materially from those expressed in these forward-looking statements. Factors that could cause actual results to differ materially from those expressed in, or implied by, forward-looking statements can be found in our filings with the US Securities and Exchange Commission, including the “Risk Factors” section in our most recent annual report. on Form 10-K. Forward-looking statements are made as of the date they are made, and we assume no obligation to update or revise any forward-looking statement.
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