TORONTO, Dec. 13, 2021 /CNW/ - Canadian Premier Life
Insurance Company ("Canadian Premier") has entered into an
agreement to acquire the sponsored markets business from Sun Life
Assurance Company of Canada
("SLA"), a wholly owned subsidiary of Sun Life Financial Inc. ("Sun
Life" or "SLF"). Sponsored markets include a variety of association
& affinity, and group creditor clients. This transaction will
see over 100 plan sponsors and roughly 1.5 million insured clients
and plan members/customers move from Sun Life to Canadian Premier.
Upon close, this transaction will build on Canadian Premier's
longstanding presence and expertise in the Canadian market.
"This is an exciting milestone for our company as we look to
serve more Canadians through our affinity groups and creditor
insurance businesses," said Suzette
Huovinen, Chief Executive Officer, Canadian Premier.
"We've provided Canadian families with coverage
for more than six decades. Our new clients will continue
to receive the same high-level of service and care they did with
Sun Life. We are very excited to welcome a new group of employees
to our Canadian Premier family and continue their great service to
these customers."
Canadian Premier continues to invest in and grow its business in
Canada, both organically and
through strategic acquisitions and partnerships. The company helps
financial institutions, retailers, affinity groups and distribution
partners overcome business challenges with relevant, client-centric
insurance solutions. The acquisition adds scale to Canadian
Premier's core creditor insurance product suite and provides
Canadian Premier with an opening to adjacent markets in the
association and affinity business. Canadian Premier's parent
company, Securian Financial Group, Inc., has a strong foundation in
the U.S. association market.
"Canadian Premier is a great fit to take over our association
& affinity and creditor group insurance businesses. They have
exceptional depth and experience and I know our clients will be in
great hands. We are committed to working closely with Canadian
Premier to plan for a smooth and seamless transition," said
Dave Jones, President, Sun Life
Health. "This transaction will allow Sun Life to focus on
strategically growing the core segments within our group benefits
business. As the largest group benefits provider in the country,
we're dedicated to delivering industry leading products and
wellness solutions."
Sun Life is the leader in the Canadian group benefits market.
They provide coverage to over 5 million employees and their
dependents. Each year Sun Life supports the health care needs of
Canadians with more than 80 million claims paid.
The transaction is expected to close in early 2023, subject to
satisfaction of customary closing conditions, including receipt of
regulatory approvals.
Upon close of the transaction, Sun Life expects to generate a
one-time after-tax gain of approximately $65
million, with a corresponding 1% increase to the SLF and SLA
LICAT ratios1, and approximately $0.03 reduction in annual underlying earnings per
share going forward2.
_______________________
|
1 Based on
current Life Insurance Capital Adequacy Test ("LICAT")
guidelines
|
2 Underlying earnings per share
impact is on an IFRS 4 basis.
|
National Bank Financial Inc. acted as exclusive financial
advisor to Sun Life on the transaction. Torys LLP is serving as
legal advisor to Sun Life in connection with this transaction. TD
Securities Inc. acted as exclusive financial advisor to Canadian
Premier and Securian Financial on the transaction. BLG LLP is
serving as legal advisor to Canadian Premier and Securian Financial
in connection with the transaction.
Forward-Looking Information
In this news release (other than Suzette
Huovinen's quotation and the "About Canadian Premier"
section), "we", "our", "us" and "Sun Life" refer to Sun Life
Financial Inc. and its subsidiaries and joint ventures. Certain
statements in this news release are forward-looking, including, but
not limited to, statements (i) relating to our growth strategies
and strategic objectives, (ii) relating to our anticipated
divestiture of our sponsored markets business, (iii) the expected
timing of the closing of the transaction, (iv) relating to the
expected after-tax gain resulting from the transaction, and the
transaction's impact on our LICAT ratios and underlying earnings
per share, (v) that are not historical or that are predictive in
nature or that depend upon or refer to future events or conditions,
and (vi) that include words such as "intends", "expect", "will",
and similar expressions. All such forward-looking statements are
made pursuant to the "safe harbour provisions" of applicable
Canadian securities laws and of the United States Private
Securities Litigation Reform Act of 1995.
The forward-looking statements in this news release represent
our current expectations, estimates and projections regarding
future events as of the time of this news release and are not
historical facts. These forward-looking statements are not a
guarantee of future performance and involve risks and uncertainties
and are based on key factors and assumptions that are difficult to
predict, particularly in light of the ongoing and developing
COVID-19 pandemic and its impact on the global economy and its
uncertain impact on our business, including the assumption that the
transaction will be completed. The forward-looking statements in
this news release do not reflect the potential impact of any
non-recurring or other special items or of any dispositions,
mergers, acquisitions, other business combinations or other
transactions that may be announced or that may occur after the date
of this news release. If any nonrecurring or other special item or
any transaction should occur, the financial impact could be complex
and the effect on our operations or results would depend on the
facts particular to such item and we cannot describe the expected
impact in a meaningful way or in the same way we could present
known risks affecting our business. Except as may be required by
Canadian securities laws, we do not undertake any obligation to
update or revise any forward-looking statements contained in this
news release.
Forward-looking statements are presented for the purpose of
assisting investors and others in understanding our expected
financial position and results of operations as at the date of this
news release, as well as our objectives for the transaction,
strategic priorities and business outlook following the
transaction, and in obtaining a better understanding of our
anticipated operating environment following the transaction.
Readers are cautioned that such forward-looking statements may not
be appropriate for other purposes and undue reliance should not be
placed on these forward-looking statements.
The following are transactional risk factors that could have an
adverse effect on the forward-looking statements in this news
release: (1) the ability of the parties to complete the
transaction; (2) failure of the parties to obtain necessary
consents and approvals or to otherwise satisfy the conditions to
the completion of the transaction in a timely manner, or at all;
(3) our ability to realize the financial and strategic benefits of
the transaction; (4) the dedication of our resources to the
completion of the transaction and the effect of the transaction on
our continuing operations in Canada; (5) the impact of the announcement of
the transaction on Sun Life and Canadian Premier; and (6) the
sponsored markets business' net asset value on close. These
risks all could have an impact on Sun Life's business relationships
(including with future and prospective employees, Clients,
distributors and partners) and could have an adverse effect on our
current and future operations, financial conditions and prospects.
Other important risk factors that could cause our actual results to
differ materially from those expressed in or implied by the
forward-looking statements in this news release are listed in the
annual information form of Sun Life Financial Inc. for the year
ended December 31, 2020, under the
heading "Risk Factors" and other regulatory filings of ours filed
or furnished to Canadian and U.S. securities regulators available
at www.sedar.com and www.sec.gov.
About Canadian Premier
For more than 60 years,
Canadian Premier has been committed to providing financial security
to Canadians and their families in the face of uncertainties.
Canadian Premier offers individual term and group life, accident
& sickness, credit and creditor insurance solutions to a number
of leading financial institutions, retailers and affinity groups,
insuring over 2 million Canadians and families coast-to-coast.
Canadian Premier is a wholly-owned subsidiary of Securian Financial
Group, Inc. To learn more about Canadian Premier,
visit www.canadianpremier.ca.
About Sun Life
Sun Life is a leading international
financial services organization providing insurance, wealth and
asset management solutions to individual and corporate Clients. Sun
Life has operations in a number of markets worldwide, including
Canada, the United States, the United Kingdom, Ireland, Hong
Kong, the Philippines,
Japan, Indonesia, India, China,
Australia, Singapore, Vietnam, Malaysia and Bermuda. As of September 30, 2021, Sun Life had total assets
under management of $1.39 trillion.
For more information, please visit www.sunlife.com.
Sun Life Financial Inc. trades on the Toronto (TSX), New
York (NYSE) and Philippine (PSE) stock exchanges under the
ticker symbol SLF.
Note to editors: All figures in Canadian
dollars
SOURCE Sun Life Financial Inc.