STI COMPLETES ACQUISITION OF GALIC AND CHANGES NAME TO AMERICAN ANNUITY GROUP, INC.
STAMFORD, Conn., Dec. 31 /PRNewswire/ -- STI Group, Inc. (NYSE: SPG), announced today that it has consummated the acquisition of Great American Life Insurance Company from Great American Insurance Company, a subsidiary of American Financial Corporation (NASDAQ: AFINP), for $470 million. STI also announced that certain related transactions have also been consummated including (i) the sale by STI to Great American Insurance Company of 17,076,923 shares of STI common stock for $111 million and 450,000 shares of STI Series A preferred stock for $45 million, (ii) the acceptance for payment by Great American Insurance Company of 5,140,973 shares of STI common stock pursuant to Great American's tender offer for such shares, (iii) the increase in the number of authorized shares of STI common stock from 50 million to 100 million and (iv) the merger of STI with and into STI Merger Co., a wholly-owned subsidiary of STI. As a result of the transactions, American Financial Corporation has increased its ownership of STI stock to approximately 80 percent of STI's outstanding shares, STI was renamed American Annuity Group, Inc. and shares of American Annuity Group common stock now trade on the NYSE under the symbol AAG. American Annuity Group, through Great American Life Insurance Company, will be engaged in the sale of qualified tax- deferred annuities to school teachers through payroll deduction programs. As financing for the transaction, a syndicate of banks led by Continental Bank, N.A., The First National Bank of Boston and Credit Lyonnais provided $180 million of bank financing and DLJ Bridge Finance, L.P., an affiliate of Donaldson, Lufkin & Jenrette Securities Corporation, provided $50 million of bridge financing. STI has filed a registration statement with the Securities and Exchange Commission with respect to an offering of up to $100 million of ten-year senior subordinated notes. The proceeds of the offering, when consummated, would be used to repay the bridge financing and a portion of the bank financing. -0- 12/31/92 /CONTACT: R. Kevin Matz, assistant treasurer of STI Group, 203-964-8628/ (SPG AFINP)
CO: STI Group, Inc.; Great American Life Insurance Company ST: Connecticut IN: INS SU: TNM
GK-OS -- NY009 -- 0873 12/31/92 11:14 EST
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|Date:||Dec 31, 1992|
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