CONSECO, PIONEER FINANCIAL ANNOUNCE MERGER AGREEMENT.CARMEL Car·mel also Car·mel-by-the-Sea A city of western California on Carmel Bay at the southern end of the Monterey Peninsula. It is an artists' and writers' colony and a popular tourist spot. Population: 4,130. , Ind IND Investigational new drug Therapeutics A status assigned by the FDA to a drug before allowing its use in humans, exempting it from premarketing approval requirements so that experimental clinical trials may be conducted. See Phase 1.2, 3 studies, Sponsorship. . and SCHAUMBURG Schaum·burg A village of northeast Illinois, a suburb of Chicago. Population: 74,900. , Ill.--(BUSINESS WIRE)--Dec. 16, 1996-- Conseco Conseco (NYSE: CNO), originally Security Life of Indiana, is a financial services organization based in Carmel, Indiana. Conseco's insurance subsidiaries provide life insurance, annuity and supplemental health insurance products to more than 4 million customers in the , Inc. (NYSE NYSE See: New York Stock Exchange :CNC (Computerized Numerical Control) See numerical control. CNC - Collaborative Networked Communication ) and Pioneer Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. , Inc. (NYSE:PFS PFS, n post facilitation stretch; therapeutic approach utilized during proprioceptive neuromuscular facilitation in which the patient begins the stretch midway between the fully relaxed and fully stretched position and uses maximum level of effort to ) today announced a merger agreement under which Conseco will acquire PFS, a national health and life insurer An individual or company who, through a contractual agreement, undertakes to compensate specified losses, liability, or damages incurred by another individual. An insurer is frequently an insurance company and is also known as an underwriter. . In the merger, each of the issued and outstanding shares of PFS common stock would be converted into the right to receive a fraction of a share of Conseco common stock having a value between $25 and $28, depending on the average closing price of Conseco shares in the 10 trading days In Business, the trading day is the time span that a particular stock exchange is open. For example, the New York Stock Exchange is, as of 2006, open from 09:30AM to 4:00PM. Trading days never take place on weekends. immediately preceding the second trading day prior to closing. PFS' outstanding convertible subordinated notes would become convertible into shares of Conseco stock on an equivalent basis. The total value of the transaction would be approximately $477 million, including $417 million to purchase PFS' 16.7 million common shares and equivalents, and $60 million to retire bank debt and pay other costs. Completion of the transaction, which is subject to customary terms and conditions, including approval by stockholders of PFS and regulatory approvals, is expected within 180 days. Conseco Chairman Stephen C. Hilbert said, "Conseco's strategic objective is to become the nation's premier provider of insurance products to the age 40-plus consumer by strengthening our leadership in each of our major product lines: (1) supplemental health insurance; (2) retirement annuities; and (3) life insurance products. This transaction, which is expected to add approximately 15 cents to Conseco's operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before per fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share in the first year, represents another important step toward that objective." "It's an excellent match," Hilbert said, "bringing together PFS' supplemental health and life insurance products and its 90,000 agents, and Conseco's products and 90,000 independent and career agents to create the largest distribution organization selling health and life insurance products in our selected markets. For customers of Pioneer Life and PFS' other major insurance subsidiaries, we believe the transaction will result in further improvements in financial ratings. For PFS agents across the nation, the transaction will provide access to Conseco's broader product line." "We are especially pleased that Peter W. Nauert, who has been chairman of PFS since 1982, will continue with Conseco," Hilbert said. "Peter will have an instrumental role in building profitable business at the PFS companies and working to maximize synergies during and after the transition to Conseco's ownership," Hilbert said. "We see tremendous potential through the joining of our companies," Nauert said. "Conseco has gained considerable respect and stature stature /sta·ture/ (stach´ur) the height or tallness of a person standing.stat´ural stat·ure n. The height of a person. stature the height of an animal in the standing position. within the industry for its ability to acquire businesses and improve efficiency to lower policyholder Policyholder An individual who owns an insurance policy. cost and increase shareholder value. PFS brings a strong reputation and track record in marketing, product development and distribution of health and life insurance products, including the development of national networks of home health care and long-term care long-term care (LTC), n the provision of medical, social, and personal care services on a recurring or continuing basis to persons with chronic physical or mental disorders. providers that should enhance sales in our senior market. By combining PFS' marketing and distribution expertise with the Conseco organization, we can together become the leading company in each of our target markets." "I am extremely supportive of the organization Steve Hilbert has built," Nauert said. "I plan to spend 100 percent of my time and energy to make this transaction successful. I look forward to working with the Conseco team to build an even larger and more successful financial service organization." PFS underwrites and markets health insurance, life insurance and annuities throughout the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . The company's primary markets are individuals age 65 and older, small business owners, self-employed individuals and middle-income families. Conseco is a financial services organization headquartered in Carmel, Ind. Through its subsidiaries, Conseco is one of the nation's leading providers of supplemental health insurance, retirement annuities and universal life insurance. Upon completion of this and other pending transactions, Conseco said it will have $32 billion of investments under management, $29 billion of assets on its own balance sheet, $7.3 billion of annual premiums and revenues, $6.6 billion of equity market capitalization Equity Market Capitalization A measure of the total market value of an equity market. The measure is calculated by taking the market capitalization of all companies in the equity market and adding them together to arrive at the capitalization for the market as a whole. , $740 million of annual EBIT EBIT See: Earnings Before Interest and Taxes EBIT See earnings before interest and taxes (EBIT). (earnings before interest and taxes In financial and business accounting, earnings before interest and taxes (EBIT) is a measure of a firm's profitability that excludes interest and income tax expenses.[1] EBIT = Operating Revenue – Operating Expenses + Non-operating Income ) cash flow, and a debt-to-capital ratio of 26 percent, well below the company's target of 35 percent. -0-
A supplement to the Conseco/Pioneer Financial Services news release of
December 16, 1996
Pioneer Financial Services, Inc.
Headquarters address: 1750 E. Golf Rd., Schaumburg, IL 60173
Stock price: $19.00 (12/13/96)
CEO: Peter W. Nauert New York Stock Exchange: PFS
Brief history:
1926--Pioneer Life founded
1982--Pioneer Financial Services incorporated
1986--PFS becomes publicly traded company
1990--PFS lists on the New York Stock Exchange
Principal business segments:
Senior division--full line of health and life insurance for age 65+
Group medical division--major medical plans for self-employed and small
business
Life insurance division--highly-rated, low-cost term insurance
Principal life insurance subsidiaries (9/30/96 assets):
Pioneer Life ($513 million)
Connecticut National Life ($315 million)
Manhattan National Life ($268 million)
National Group Life ($85 million)
Continental Life & Accident ($78 million)
Universal Fidelity Life ($41 million)
Major locations (employees): Rockford, IL (540); Irving, TX (300);
Schaumburg, IL (200); Cincinnati, OH (200); Other Offices (500)
Investor Hotline--(800) PFS-8998
-0-
A supplement to the Conseco/Pioneer Financial Services news release
of December 16, 1996
Conseco, Inc.
Leading the process of change in the financial services industry.
Headquarters address: 11825 N. Pennsylvania St., Carmel, IN 46032
Stock price: $59.50 (12/13/96)
CEO: Stephen C. Hilbert New York Stock Exchange: CNC
Brief history:
1979--company incorporated
1985--Conseco becomes publicly traded company
1986--Conseco lists on the New York Stock Exchange
1982-1996--Conseco completes 16 acquisitions involving a total of 29
insurance companies
Principal business segments:
Senior market operations--Medicare supplement, long-term care, cancer,
heart/stroke and other supplemental health products
Annuity operations--fixed and variable annuities
Life insurance operations--universal life, term life and whole life
products
Principal life insurance subsidiaries (9/30/96 assets/A.M. Best rating):
American Life and Casualty ($5.373 billion/A-)
Philadelphia Life ($1.573 billion/A)
Bankers Life and Casualty ($3.616 billion/A)
(1) Capitol American Life ($742 million/A)
Beneficial Standard Life ($2.524 billion/A)
(1) American Travellers Life ($720 million/A-)
Great American Reserve ($2.315 billion/A)
Lamar Life ($685 million/A)
Massachusetts General Life ($1.629 billion/A)
(1) Transport Life ($477 million/A-)
NOTE (1): acquisition pending
Financial performance:
Among all Fortune 500 companies, Conseco ranks:
No. 2 in 10-year total return to investors;
No. 6 in 10-year earnings per share growth
Major locations (employees):
Carmel, Indiana (1,750);
Chicago, Illinois (1,250);
Other Offices (700)
World Wide Web--http://www.conseco.com
Investor Hotline--(800) 4-CONSECO
Fax-on-Demand--(800) 344-6452
CONTACT: Conseco, Inc. Jim Rosensteele, Vice Pres.-Investor Relations (317) 817-2893 OR Pioneer Financial Services, Inc. Nancy Zalud, Senior Vice President (847) 995-0400 |
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