The insurer announced the closing of the deal, which was made for $4 billion.
The Allstate Corporation recently announced the closing of its acquisition deal for National General Holdings Corp, for $4 billion.
This new purchase is the latest in a number of strategic moves being made by the insurance company.
“The acquisition of National General advances our strategy of growing personal lines insurance with an increase of 1 percentage point in market share. Independent agents will now have more protection offerings for customers, with a strong technology platform creating growth opportunities for them and Allstate. National General’s accident and health business will also further expand Allstate’s circle of protection,” said The Allstate Corporation president, CEO and chair, Tom Wilson.
The insurance company has stated that it intends to release additional information about this recent acquisition on February 4, 2021, during Allstate’s quarterly earnings call. That said, it is already know that this is only one of several strategic moves the company has been making over the last few years – and that it will continue to make – in an increasingly competitive environment.
Allstate seeks to use its National General Holdings Corp acquisition to bolster its personal lines premiums.
With the closure of the $4 billion cash deal, National General shareholders will receive $32 per share, in addition to about $2.50 per share in dividends. This will provide them with a total of $34.50 per share that they hold.
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The company’s 2019 gross premiums were $5.6 billion, with an operating income of about $319 million that year. This was generated from a spectrum of property-liability coverage products, including “non-standard” auto insurance.
According to Allstate, this move will also help to strengthen its independent agent businesses. National General has 42,000 independent agents of its own, selling property-casualty products. It will also raise the insurer’s own personal lines premiums by $4 billion and raise its market share by over 1 percent, to bring it to 10 percent total.
The National General Holdings Corp board in New York City had already approved the deal to be acquired by Allstate. Moreover, no less than 40 percent of its voting shares also committed to the deal’s approval.