Dai-ichi, Protective Life Merger Gets Final Nod from Agencies

The Dai-ichi Life Insurance Company, Limited and Protective Life Corporation (PL) announced new developments on the plan of a merger between the two.

The final and the most crucial step in concluding the transaction has been reached, with regulatory authorities in the United States and Japan giving necessary approvals to the merger.

Now, the merger is expected to close on Feb 1, 2015 and each outstanding share of Protective common stock will be converted into the right to receive $70.00 in cash.

This transaction will also enable Protective Life to deliver substantial, immediate cash value to its shareholders and sustain growth. Moreover, Protective Life will be part of the thirteenth largest global insurer which Dai-ichi Life will transform to, post merger. Protective Life will rise in rank from a medium to a large-size U.S. insurer.

While Protective will retain its operational and management setup, the buyout will bring immense diversification benefits, helping it to transform from a national to an international player by virtue its of being a wholly owned subsidiary of the Japanese insurer. Dai-ichi Life enjoys an active market presence in other parts of the globe. Other support in terms of capital, management expertise and an expanded distribution facility will be part of the parcel.

Protective Life would nicely complement Dai-ichi as the company scores strongly on a number of aspects such as robust operating performance, strong and a diversified business profile, sound capital structure and a disciplined capital management strategy which has managed to generate substantial returns for investors.

The union would give Dai-ichi a significant foothold in the U.S. insurance market which is dominated by players like MetLife Co. (MET) and Prudential Financial Inc. (PRU).

Japanese insurers are increasingly looking for inorganic growth across the globe to diversify operations. In 2012, another Japanese insurer Tokio Marine Holdings Inc. (TKOMY) snapped up Delphi Financial Group Inc. to expand its U.S insurance business.