Farm Bureau Property & Casualty and Iowa Farm Bureau Federation to Take FBL Financial Group Private for $56.00 Per Share
FBL Financial Group (NYSE: FFG) has agreed to be acquired by Farm Bureau Property & Casualty Insurance Company (FBPCIC) for $56.00 per share in cash, representing a 50% premium over its unaffected share price of $37.25. The transaction, valued at approximately $528 million, was unanimously approved by the FBL Board following a detailed review. The deal requires regulatory approval and a majority vote from unaffiliated shareholders. Closing is anticipated in the first half of 2021, after which FBL common stock will cease to trade on the NYSE.
- Acquisition price of $56.00 per share represents a 50% premium over previous closing price.
- Transaction provides immediate cash value for unaffiliated shareholders.
- Unanimous support from FBL Financial Group Board demonstrates confidence in the offer.
- FBL common stock will cease trading on the NYSE post-acquisition, limiting public investment.
- Approval from a majority of unaffiliated shareholders is required, which could delay or jeopardize the deal.
Farm Bureau Property & Casualty Insurance Company (“FBPCIC”) and FBL Financial Group, Inc. (NYSE: FFG) (“FBL Financial Group” or “the Company”) today announced that they have reached a definitive agreement under which FBPCIC will acquire all of the outstanding shares of FBL Financial Group Class A and Class B common stock that neither FBPCIC nor the Iowa Farm Bureau Federation (“IFBF”) currently own for
The per share purchase price represents a
In making its recommendation, the Special Committee, with advice from independent financial and legal advisors, conducted a detailed review of FBPCIC’s offer. Among other factors, the Special Committee evaluated the offer relative to the Company’s standalone prospects, including management’s expectation for adjusted operating income of
“The Special Committee’s focus has been on maximizing value for FBL Financial Group’s unaffiliated shareholders, and this transaction delivers immediate cash value to them at a significant premium," said Paul Larson, Chairman of the Special Committee of the FBL Financial Group Board of Directors. “The agreement announced today follows several rounds of rigorous negotiation during which FBPCIC increased its offer multiple times and agreed the Company should continue to pay its regular quarterly dividend through closing – both of which represent material value increases. Based on the unanimous recommendation of the Special Committee and deep knowledge of the Company, the FBL Financial Group Board unanimously concluded that this transaction is the best way to deliver maximum and certain value to our unaffiliated shareholders. FBPCIC has been a long-term partner of FBL Financial and shares our dedication to protecting the livelihoods and futures of our customers, and we are confident that this transaction is in the best interest of unaffiliated shareholders.”
“FBL Financial Group and its affiliated companies make up a superb organization,” said Richard Felts, Chairman of the Board of FBPCIC. “We look forward to supporting its future as a private company, and to continue working to grow and strengthen the organization’s relationships with its customers and communities.”
Additional information about the transaction and its rationale may be found in an Investor Presentation deck that is being filed by FBL Financial Group with the SEC on Form 8-K contemporaneously with this release.
Approvals
The transaction is subject to the receipt of regulatory and FBL Financial Group shareholder approval, including approval from a majority of unaffiliated FBL Financial Group shareholders, and the satisfaction of specified closing conditions. Specifically, the terms require approval of (i) a majority of the shares of the outstanding FBL Financial Group Class A common stock and Series B preferred stock, voting together as a single class; (ii) a majority of the outstanding shares of FBL Financial Group Class B common stock; and (iii) a majority of all outstanding FBL Financial Group common stock not owned by FBPCIC and its affiliates, IFBF and its affiliates, or their respective directors and officers. IFBF owns
Transaction Details
Closing is expected in the first half of 2021, subject to the receipt of regulatory and FBL Financial Group shareholder approval and the satisfaction of specified closing conditions. Upon closing, all shareholders of FBL Financial Group other than FBPCIC and IFBF will receive the same per share cash consideration for their shares. IFBF will contribute its FBL common stock to a newly-formed subsidiary of FBPCIC (which will merge with and into FBL Financial Group in the merger, with FBL Financial Group continuing as the surviving corporation) and will retain an ownership stake in the surviving corporation commensurate with its aggregate percentage ownership of Class A and Class B common stock of FBL Financial Group as of immediately prior to the consummation of the transaction. The transaction is not subject to a financing condition.
Upon completion of the transaction, IFBF will continue to be the majority owner of the Company, and FBL Financial Group common stock will cease trading on the New York Stock Exchange.
Advisors
Barclays Capital Inc. served as financial advisor to the Special Committee of the Board of Directors of FBL Financial Group, and Sidley Austin LLP as its legal advisor. Milliman was also engaged to provide an independent actuarial appraisal of FBL Financial Group to support the Special Committee’s evaluation and negotiation process.
Goldman Sachs & Co. LLC served as financial advisor and Skadden, Arps, Slate, Meagher & Flom LLP served as legal advisor to FBPCIC.
Reconciliation of Net Income to Adjusted Operating Income to Common Shareholders
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