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The "Farmers Insurance News-Alert" website is dedicated to providing the consumer and general public with detailed information concerning the Farmers Insurance Group. This includes fraud reports, consumer complaints, lawsuit's and other legal actions taken against this company. All information contained herein is for educational purposes only. Original sources, when known are sited.

 

B.A.T gets approval for Zurich deal

LONDON, June 12 (Reuters) - A proposal to merge B.A.T's financial services operations with Swiss insurer Zurich was on Friday approved by shareholders in the British conglomerate.

B.A.T said in a statement that it had received overwhelming support for the deal which was announced last year, but is not expected to be finalised until the autumn.


Shareholders in Zurich approved the merger on Thursday.

The deal will see the creation of a dual holding company. Zurich shareholders will hold shares of Zurich Allied AG, which will own 57 percent of the combined company, to be called Zurich Financial Services.

B.A.T shareholders will receive shares in Allied Zurich Plc, which will own 43 percent of Zurich Financial Services, and British American Tobacco Plc, both of which will be listed on the London Stock Exchange.

B.A.T chairman Lord Cairns said the likely date of listing for the shares should be known about a month in advance.

The new financial services company will have about $375 billion in assets under management.

The deal combines Zurich and its asset management unit Scudder Kemper Investments with B.A.T's Eagle Star and Allied Dunbar in Britain and Farmers Insurance Group in the United States.

"The merger will create one of the world's largest insurance and financial services groups, operating in over 50 countries and serving some 30 million customers," Zurich Group chairman Rolf Hueppi said on Thursday.

Based on International Accounting Standards, the new group's pro-forma net income for 1997 amounts to $1.2 billion and its pro-forma shareholder equity is well above $21 billion, Hueppi also said.

The United States will be the group's largest home market, Hueppi said.

He said the merger would provide for quicker expansion of the Farmers Insurance system eastward into new states, creation of a combined range of Farmers and Zurich Kemper Life products and marketing of Scudder Kemper Investment mutual funds under the Farmers brand.

He also said the merger provided scope for two new strategic business units -- one for non-standard auto insurance and one to focus on recreational and speciality vehicles -- and made possible an expansion of the group's range of life products through new structured settlement and variable annuity life products.

Uncertainty remains about the group's strategy on its reinsurance business, particularly about the future of Eagle Star Re.

11:18 06-12-98

 

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