Japan's Dai-ichi Life Insurance Co has agreed to purchase U.S. peer Protective Life for $5.7 billion, the largest acquisition by a Japanese insurer, displaying its determination to grow overseas to counter weak prospects at home.Dai-ichi Life, Japan's second-largest private-sector life insurer, said it will issue up to 250 billion yen ($2.4 billion) in new shares to help finance the widely expected purchase of Protective Life. The Japanese insurer will retain existing management at the Birmingham, Alabama-based target, which booked premiums and policy fees of $2.98 billion and net income of $393 million in 2013.Faced with weak growth prospects at home amid Japan's ageing population, Dai-ichi Life and other Japanese insurers have been buying assets in more dynamic markets from the United States to Southeast Asia. While the U.S. insurance market is the world's biggest, demand for insurance policies in Southeast Asia is expected to rise among the region's emerging middle class.Under terms of the deal, Dai-ichi Life will pay $70 per share to buy 100 percent of Protective Life, a 35 percent premium to Protective's average share price in the past month. The Japanese company said it expects the deal to close sometime between December 2014 and January 2015, pending approval by the target's shareholders and regulators.
Protective Life Corporation is a holding company. Shares of PL traded higher by 0.36% or $0.21/share to $58.72. In the past year, the shares have traded as low as $36.36 and as high as $60.38. On average, 476861 shares of PL exchange hands on a given day and today's volume is recorded at 2050653.
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