Disposal
February 28 2003 - 9:38AM
UK Regulatory
RNS Number:1449I
Irish Life & Permanent PLC
28 February 2003
* Irish Life & Permanent plc announces agreement on sale of remaining US
Business
Friday 28 February 2003. Irish Life & Permanent plc ("the Group") has reached
agreement on the sale of its remaining operating company in the United States of
America, Guarantee Reserve Life Insurance Company ("GR" or the "Company").
The Calumet City, Illinois.-based -Company, which is focussed on the US small
premium final expense market, is to be purchased, subject to US regulatory
approval, by Reassure America Life Insurance Company, a subsidiary of Swiss Re
Life & Health America Inc. The deal is expected to close in the second quarter
of the year. The price payable is $121.0 million with a provision for adjustment
for the movement in capital and surplus in the Company up to the date of
completion of the transaction.
The carrying value of the Company in Irish Life & Permanent's books at 31
December 2002 was $176.0 million calculated on the basis of a 9 percent discount
rate. The full consideration is payable in cash on completion of the
transaction. No tax is estimated to be payable on the disposal. The proceeds
from the sale will be deployed in the group's Irish operations.
In line with generally accepted accounting standards, this transaction will be
included in Irish Life & Permanent's accounts for 2003.
The decision to sell GR is in line with Irish Life & Permanent's "Ireland First"
strategy whereby the Group is focussed on consolidating its leadership position
in the Irish market. GR has failed to return the anticipated improvement in
operating performance. Hence the level of consideration achieved reflects both
the strategic significance of the sale for Irish Life & Permanent as well as the
depressed market conditions at this time. This disposal will end the Groups
operational involvement in the US.
Advisors to Irish Life & Permanent plc were Salomon Smith Barney and Dewey
Ballantine.
Swiss Re is one of the world's leading reinsurers with over 70 offices in more
than 30 countries. At the end of June 2002, Swiss Re's shareholders' equity
amounted to CHF 18.3 billion and the total balance sheet stood at CHF 168
billion. Swiss Re is rated "AA+" by Standard & Poor's, "Aa1" by Moody's and
"A++" by A.M. Best.
Further Information (Irish Life & Permanent plc):
Investors
Peter Fitzpatrick
Finance Director
Ph: 00353 1 7041680
David McCarthy
Group Chief Financial Officer
Ph: 00353 1 8563050
Barry Walsh
Head of Investor Relations
Ph: 00 353 1 7042678
Media
Ray Gordon
MRPA Consultants
Ph: 00 353 1 6788099
Ph: 00 353 87 2417373 (mobile)
This information is provided by RNS
The company news service from the London Stock Exchange
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