UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: October 14, 1998
Date of earliest
event reported: October 1, 1998
LINCOLN NATIONAL CORPORATION
(exact name of registrant as specified in its charter)
Indiana 1-6028 35-1140070
(State of incorporation) (Commission File Number) (I.R.S. Employer
Identification No.)
200 East Berry Street, Fort Wayne, Indiana 46802-2706
(Address of principal executive offices)
Registrant's telephone number 219-455-2000
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Item 2 Acquisition or Disposition of Assets
On October 1, 1998, Lincoln National Corporation ("LNC") announced the
completion of the acquisition of a block of individual life business from
Aetna, Inc for $1.0 billion (see copy of press release below). This transaction
was completed as a 100% indemnity reinsurance agreement among two of Aetna's
affiliates (Aetna Life Insurance Company and Aetna Life Insurance and Annuity
Company) and two of LNC's life insurance affiliates (Lincoln National Life
Insurance Company and Lincoln Life & Annuity Company of New York). The price
resulted from a negotiation process with the seller. The source of cash for this
purchase was from the proceeds of two third quarter 1998 financings ($200.0
million 7.4% Series C Trust Originated Preferred Securities and $230.0 million
of FELINE PRIDES) plus available cash remaining from the sale of its property
casualty business segment in 1997. This block of business includes individual
life insurance contracts from all states in the United States. Pro forma
financial statements for LNC and the block of business and audited statements
of the block of business purchased will be filed with the Commission as an
amendment to this Form 8-K not later than 60 days after the date that this
report must be filed.
PRESS RELEASE
October 1, 1998
LNC COMPLETES $1.0 BILLION ACQUISITION OF AETNA'S DOMESTIC INDIVIDUAL LIFE
BUSINESS
Lincoln Financial Group said today it completed the previously announced
acquisition of the domestic individual life insurance business of Aetna (NYSE:
AET) for $1 billion in cash. Lincoln Financial Group is the marketing name for
Lincoln National Corporation (NYSE: LNC) and its affiliates.
The acquisition, which was announced May 21, 1998, includes approximately $50
billion of life insurance in force. In addition, the acquisition increases
Lincoln Financial Group's presence in the independent brokerage distribution
channel serving the affluent market.
"This acquisition has compelling strategic benefits for Lincoln Financial
Group," said Jon A. Boscia, LNC president and chief executive officer. "It
positions Lincoln Life as a leader in the brokerage market and strengthens our
life insurance expertise and capabilities. Furthermore, it offers significant
growth potential in the highly affluent market that we have been targeting."
"We are confident that this transaction, combined with the individual life
insurance and annuity business we acquired earlier this year from CIGNA
Corporation, will establish Lincoln Life as a premier provider of sophisticated
financial and estate planning services," said Gabriel L. Shaheen, president of
Lincoln Life.
The transaction involves traditional life insurance, universal life insurance,
participating life insurance and corporate-owned life insurance. On August 7,
Lincoln Financial Group agreed to sell a block of sponsored life insurance that
was part of the Aetna transaction to Protective Life Corporation (NYSE: PL) of
Birmingham, Ala.
Approximately 250 job offers have been extended to Aetna employees associated
with the business. All the home office employees retained from Aetna will be
located in the Hartford offices of Lincoln Financial Group where 600 employees
are located.
With this acquisition, combined with the earlier acquisition of CIGNA's
individual life insurance and annuity business, Lincoln Life now sells its
products through 2,300 career agents, 90 independent managing general agents and
through 15,000 individual brokers and 57,000 stockbrokers.
Lincoln National Corporation is a prominent financial services holding company
in the United States with more than $130 billion in assets under management and
$6 billion in annual revenues. Through its businesses, LNC provides annuities,
life insurance, 401(k) plans, life-health reinsurance, institutional investment
management and advisory services, mutual funds and financial planning.
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Item 7 Financial Statements and Exhibits
(a) Financial statements of business acquired
Audited financial statements covering the block of individual life business
being acquired will be filed with the Commission (an amendment to this Form
8-K) not later than 60 days after the date that this report must be filed.
(b) Pro forma condensed consolidated financial information (unaudited)
Pro forma condensed consolidated financial statements will be filed with the
Commission (an amendment to this Form 8-K) not later than 60 days after the
date that this report must be filed.
(c) Exhibit
Exhibit 02 Second Amended and Restated Asset Purchase Agreement By
and Among LNC's Affiliates (Lincoln National Life Insurance
Company and Lincoln Life & Annuity Company of New York) and
Aetna Life Insurance Company and Aetna Life Insurance and
Annuity Company, Dated as of May 21, 1998.
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SIGNATURE PAGE
LINCOLN NATIONAL CORPORATION
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
LINCOLN NATIONAL CORPORATION
By /s/ Richard C. Vaughan
Richard C. Vaughan
Executive Vice President and
Chief Financial Officer
By /s/ Donald L. Van Wyngarden
Donald L. Van Wyngarden
Second Vice President and
Controller
Date October 14, 1998