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STI RECEIVES COMMITMENTS FOR FINANCING OF ACQUISITION OF GREAT AMERICAN LIFE INSURANCE COMPANY

 STI RECEIVES COMMITMENTS FOR FINANCING OF ACQUISITION
 OF GREAT AMERICAN LIFE INSURANCE COMPANY
 STAMFORD, Conn., Nov. 3 /PRNewswire/ -- STI Group, Inc. (NYSE: SPG) announced today that it has received commitments for the financing to consummate the previously announced acquisition of Great American Life Insurance Company (GALIC) from Great American Insurance Company, a wholly owned subsidiary of American Financial Corporation. Such financing includes $180 million of bank financing to be arranged by Continental Bank, N.A. and The First National Bank of Boston and $50 million of bridge financing to be provided by DLJ Bridge Finance, L.P., an affiliate of Donaldson, Lufkin and Jenrette Securities Corporation.
 The bank commitment contemplates a $180 million senior secured term loan amortizing over seven years to be provided to STI by Continental Bank, Bank of Boston, Credit Lyonnais and a syndicate of other banks. The bridge commitment provides for the purchase by DLJ Bridge Finance from STI of $50 million of senior subordinated bridge notes with a one- year maturity. The commitments are subject to a number of conditions, including completing the arrangement of bank financing, preparation of satisfactory definitive documentation and obtaining required regulatory approvals.
 STI is also considering, subject to market conditions, a public offering of up to $100 million of ten-year senior subordinated notes of STI either concurrently with the acquisition of GALIC or shortly thereafter. If a public offering is consummated concurrently with the acquisition of GALIC, STI would not issue the bridge notes to DLJ Bridge Finance and proceeds of the public offering in excess of $50 million would be used to reduce the amount of the bank financing. If a public offering is consummated after the acquisition of GALIC, proceeds of the offering would be used to repay the bridge notes and to prepay a portion of the bank financing. If a public offering is not consummated prior to maturity of the bridge notes, the $50 million of bridge notes will be purchased by Great American Insurance Company and exchanged for senior subordinated notes with a nine-year maturity.
 -0- 11/3/92
 /CONTACT: R. Kevin Matz, assistant treasurer of STI Group, Inc., 203-964-8628/
 (SPG AFINP) CO: STI Group, Inc.; American Financial Corporation ST: Connecticut IN: CPR INS SU: TNM


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Publication:PR Newswire
Date:Nov 3, 1992
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