US primary insurance carrier, The Allstate Corporation, has completed the sale of Allstate Life Insurance Company (ALIC) and certain subsidiaries to entities managed by private equity investment giant, Blackstone.
First announced in January 2021, the deal involved total proceeds of $4 billion, which included Blackstone’s $2.8 billion purchase price, as well as increases in statutory surplus since March 31, 2020.
Following its acquisition by Blackstone, the ALIC business will be renamed as Everlake Life Insurance.
“Allstate’s strategy is to increase personal property-liability market share and expand protection offerings to customers,” explained aid Tom Wilson, Chair, President and CEO of The Allstate Corporation.
“This sale redeploys capital into highly attractive property-liability and protection service businesses and reduces interest-rate exposure.”
The sale of ALIC, along with the previously announced sale of Allstate Life Insurance Company of New York (ALNY) to Wilton Re, reduces assets by approximately $34 billion to $99 billion and liabilities by approximately $33 billion to $72 billion as of June 30, 2021, and resulted in a GAAP book loss of approximately $3.8 billion in the first quarter of 2021.
Approximately $1.7 billion of deployable capital was generated by these transactions and was considered when authorizing the current $5 billion share repurchase program.
“We are pleased to complete this transaction,” commented Gilles Dellaert, Global Head of Blackstone Insurance Solutions.
“We believe the investment outperformance we can deliver through our industry-leading private credit origination platforms – while maintaining strong policyholder protections – will play a vital role in helping meet long-term customer obligations, especially at a time of historically low interest rates.”
