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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) July 15, 1998
SUNAMERICA INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
MARYLAND 1-4618 86-0176061
(STATE OR OTHER JURISDICTION (COMMISSION (IRS EMPLOYER
OF INCORPORATION) FILE NUMBER) IDENTIFICATION NO.)
1 SUNAMERICA CENTER
LOS ANGELES, CALIFORNIA 90067-6022
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
Registrant's telephone number, including
area code (310) 772-6000
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Item 5. Other Events
-------------
See attached Press Release.
SUNAMERICA INC.
Date: July 17, 1998 By: /s/ Scott L. Robinson
-----------------------------
Scott L. Robinson
Senior Vice President
and Controller
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SUNAMERICA
NEWS
contact:
Investors: Karel Carnohan
Vice President, Investor Relations
(310) 772-6533
Media: Don Spetner
Vice President, Corporate Communications
(310) 772-6775
FOR IMMEDIATE RELEASE
SUNAMERICA INC. SIGNS DEFINITIVE AGREEMENT TO ACQUIRE
LIFE & ANNUITY BUSINESS FROM MBL LIFE ASSURANCE CORP.
SunAmerica Gains Strong Presence in 403(b) Market;
Deal Expected to be Immediately Accretive to Earnings
LOS ANGELES -- July 15, 1998 -- SunAmerica Inc. (NYSE: SAI) today announced
that it has entered into a definitive agreement for its wholly owned
subsidiary, Anchor National Life Insurance Company, to acquire the individual
life and individual and group annuity business of MBL Life Assurance
Corporation ("MBL Life") via a reinsurance transaction for approximately $130
million in cash. SunAmerica management estimates that $300 million of capital
will be required to support the acquired business.
MBL Life is a former subsidiary of The Mutual Benefit Life Insurance Company,
which was placed in rehabilitation in 1991. Completion of the transaction is
expected within 6 months, subject to customary conditions and various
governmental and other third-party approvals. SunAmerica expects that the
transaction will be accretive to earnings immediately upon closing.
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SunAmerica 2-2-2
The transaction will include 380,000 universal life and annuity policies. As
of March 31, 1998, the reserves for these policies totaled approximately $5
billion, including $3 billion of fixed annuity reserves, primarily comprising
403(b) contracts, and $2 billion of reserves for universal life policies.
SunAmerica plans to reinsure a large portion of the mortality risk associated
with the acquired block of universal life business.
The assets supporting the reserves to be acquired by SunAmerica consist
primarily of high-quality, liquid investments, virtually all of which are
rated investment grade. The transaction does not include MBL Life's separate
account insurance business, corporate-owned life insurance (COLI) business, or
disability income business.
The MBL Life annuity block is composed of large accounts that will
significantly enhance SunAmerica's position in the 403(b) qualified retirement
savings market. Although SunAmerica's business focus is not mortality-based
life insurance, the MBL Life universal life policies are a quality block of
business that can be easily administered.
The SunAmerica acquisition will enable MBL Life's eligible policyholders to
share in the total value of MBL Life. MBL Life estimates that this will
result in the distribution of $240 million to these policyholders through June
2003. In addition, the acquisition will allow completion of the Mutual
Benefit rehabilitation process ahead of schedule.
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SunAmerica 3-3-3
"This transaction provides enhanced value for MBL Life's policyholders as well
as SunAmerica's shareholders," said Eli Broad, chairman and chief executive
officer of SunAmerica Inc. "We have a proven track record of assimilating
acquisitions quickly and efficiently, and we are committed to making the
transition for the MBL Life policyholders as smooth as possible." Broad added
that SunAmerica has purchased more than $10 billion of fixed annuities over
the past 30 months in four separate transactions.
Mutual Benefit Life Insurance Company began selling individual life insurance
in 1845. As of 1991, it was the nation's fourth-oldest and eighteenth-largest
insurer. After Mutual Benefit was placed in rehabilitation in 1991, MBL Life
assumed and reinsured the insurance liabilities and assumed most of the assets
of Mutual Benefit Life under a court-approved plan which took effect in 1994.
SunAmerica Inc. is a diversified financial services company specializing in
retirement savings and investment products and services. The company earns
fees or spread income on approximately $105 billion of assets, including $25
billion of investments and $12 billion of variable annuity assets on its
balance sheet at March 31, 1998; $3 billion managed in mutual funds and
private accounts; $14 billion under custody in retirement trust accounts; and
an estimated $51 billion of non-proprietary and advisory assets in The
SunAmerica Financial Network. Anchor National Life Insurance Company is rated
"A+" (Superior) by A.M. Best, "AA-" (Excellent) by Standard & Poor's, "AA"
(Very High) by Duff & Phelps and "A2" (Good) by Moody's.
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SunAmerica 4-4-4
To obtain investor materials, including SunAmerica's annual and quarterly
shareholder reports, please call our investor relations department at (310)
772-6235, or send e-mail requests to [email protected]. To learn more
about the SunAmerica companies, please visit our Web site at
www.sunamerica.com.
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