Life Reinsurer To Turn Business Over To Another Reinsurer

Consummation of the deal is subject to approval by shareholders and Annuity & Life Re's retrocessionaires. So far, holders of about 27% of Annuity & Life Re's common stock already have indicated that they will vote in favor of the transaction, the company says.

The company notes that it continues to look for other "strategic alternatives to attempt to maximize its economic value." Options could include a merger, sale, joint venture or other comparable transaction, the company says. But, under some conditions, Annuity & Life Re might have to pay Wilton Re a $500,000 break-up fee if it decides to go with another suitor.

Annuity & Life Re notes that it will continue to exist as a corporation if it succeeds at completing the Wilton Re deal and that the remaining corporation will continue to have a book value of about $1.70 to $1.84 per common share.

Annuity & Life Re would continue to be responsible for some obligations, such as obligations transferred to other reinsurers. If the other reinsurers are unable or unwilling to pay valid claims, Annuity & Life Re would have to pay the claims, the company says.

Annuity & Life Re "also has continuing obligations under employment agreements with certain of its employees, including obligations to make severance payments under certain circumstances," the company says.