September 17th, 2009
Nippon Life Insurance Company
Investment in Prudential Insurance Company of America
Nippon Life Insurance Company (President: Kunie Okamoto, hereinafter
“Nippon Life”) announced today its purchase of 10-year exchangeable surplus note issued by The Prudential Insurance Company of America (hereinafter “PICA”), a US insurance subsidiary of Prudential Financial, Inc. (Chairman & CEO: John Strangfeld, Head office: Newark, NJ, USA, hereinafter “Prudential”), one of the largest financial service companies in the United States. The investment amount will be USD500 million (approximately JPY46 billion) and the transaction is expected to close on September 18th, 2009.
Nippon Life has the option to exercise its exchange right to receive common
stock issued by PFI, any time after its fifth anniversary of issuance of the note.
Prudential is one of the world leading financial service companies established in
1875 that offers life insurance, annuities and asset management services. PICA is the largest insurance company of the group in the United States.
In addition, Prudential now operates three life insurance subsidiaries in Japan
such as The Prudential Life Insurance Company, The Gibraltar Life Insurance Company and The Prudential Financial Japan Life Insurance Company.
Nippon Life has a long-standing relationship with Prudential, who share the
same values and beliefs in life insurance business.
The objective of this investment is to further strengthen our relationship
between Nippon Life and Prudential in a manner mutually beneficial for both companies. As of September 15th, Nippon Life holds 2,560,000 shares of Prudential and purchase of the surplus note is subsequent to the above investment.
We will continue to seek opportunities to work together with Prudential, who has
great influence inside and outside Japan, to promote the well-being of the life insurance industry.
Prudential has also announced this investment.
(Attachment) About Prudential Financial, Inc.
Prudential Financial, Inc.
Newark, NJ, U.S.A.
Life insurance, annuities, retirement-related services, mutual funds, investment management and real estate services
4.Financial results （
as of Dec. 31, 2008）
Total assets USD445 billion (JPY41 trillion) Revenue USD29.3 billion (JPY3 trillion) (consolidated base)
About surplus notes Surplus notes are a financial instrument with capital characteristic which is issued by U.S. life insurers. It is similar to a corporate bond. Interests are paid regularly and redemption will be done at maturity. Surplus notes are regarded as capital as it is subordinated to all liabilities and need to have authorization from states’ control authority at any time when coupon and principal are paid. Under Statutory Accounting Principles (SAP), it is classified as an insurance company’s capital.