Great American Financial Resources, Inc. Announces Execution of Definitive Merger Agreement to Acquire Ceres Group
02 May 2006 - 8:34AM
PR Newswire (US)
CINCINNATI, May 1 /PRNewswire-FirstCall/ -- Great American
Financial Resources, Inc. ("GAFRI") (NYSE:GFR) today announced that
it has signed a definitive merger agreement to acquire all of the
outstanding shares of Ceres Group, Inc. ("Ceres") (NASDAQ:CERG)
through a cash merger. Under terms of the merger agreement, GAFRI
will pay $6.13 in cash for each outstanding share of Ceres common
stock, for a total purchase price of approximately $205 million on
a fully diluted basis. (Logo:
http://www.newscom.com/cgi-bin/prnh/20041206/CLM061LOGO) The
transaction is expected to be completed in the third quarter of
2006. The transaction is subject to the approval of Ceres'
stockholders and the Ohio and Nebraska Department of Insurance and
other customary conditions. Ceres, with assets of approximately
$775 million, has approximately 600 employees located at its
Cleveland, OH headquarters and at offices in Omaha, NE and Mission,
KS. S. Craig Lindner, President and CEO of GAFRI, commented on the
transaction by saying, "The acquisition of Ceres is consistent with
our strategy of using our excess capital to grow our core lines of
business. We believe Ceres is a very good strategic fit with our
existing supplemental health businesses. We believe that
post-acquisition GAFRI will be one of the top ten producers of
Medicare supplement products. In addition, the acquisition will
provide opportunities for us to make annuities and other products
available to the Ceres distribution network. We intend to focus on
completing the Ceres acquisition while continuing to look for
opportunities to grow and strengthen our core businesses through
acquisitions." Charles R. Scheper, Chief Operating Officer of GAFRI
said, "Over the last several years we have worked diligently to
make acquisitions such as the Ceres transaction. We have also
worked just as hard to grow organically. I am excited about the
positive impact that Ceres will have on our organization." "Today
we begin the next evolutionary phase of the Ceres Group of
companies," said Tom Kilian, President and Chief Executive Officer
of Ceres. "As a public company, one of our core objectives has
always been to maximize shareholder value. Our merger with GAFRI
accomplishes this objective, and we are confident that it will also
provide synergies and market strength that will benefit customers
and agents. Ceres and GAFRI are an excellent strategic fit. This
merger will produce a much larger senior market presence and
strengthened combined competitive position. We are committed to
working with GAFRI on a smooth transition." About GAFRI GAFRI is a
Cincinnati-based insurance holding company with $12 billion in
assets. The Company's subsidiaries include Great American Life
Insurance Company, Annuity Investors Life Insurance Company, United
Teacher Associates Insurance Company (headquartered in Austin,
Texas) and Loyal American Life Insurance Company. Through these
companies, GAFRI markets traditional fixed, indexed and variable
annuities and a variety of supplemental insurance products. For
more information, visit http://www.gafri.com/. About Ceres Group
Ceres Group, Inc., through its insurance subsidiaries, provides a
wide array of health and life insurance products through two
primary business segments. Ceres' Medical Segment includes major
medical health insurance for individuals, families, associations
and small businesses. The Senior Segment includes senior health,
life and annuity products for Americans age 55 and over. To help
control medical costs, Ceres also provides medical cost management
services to its insured. Ceres' nationwide distribution channels
include independent and career agents, as well as electronic
distribution systems. Ceres is included in the Russell 3000(R)
Index. For more information, visit http://www.ceresgp.com/.
Forward-Looking Statements The Private Securities Litigation Reform
Act of 1995 encourages corporations to provide investors with
information about the Company's anticipated performance and
provides protection from liability if future results are not the
same as management's expectations. Documents may contain certain
forward-looking statements that are based on assumptions which
management believes are reasonable but, by their nature, inherently
uncertain. Future events and results could differ materially from
those projected. Factors that could cause such differences include,
but are not limited to: changes in economic conditions, market
interest rates, regulatory actions and changes in the financial
condition or results of operations of Ceres. Forward-looking
statements are made only as of the date of their release and GAFRI
does not have any obligation to update any forward-looking
statements to reflect subsequent events or circumstances.
http://www.newscom.com/cgi-bin/prnh/20041206/CLM061LOGO
http://photoarchive.ap.org/ DATASOURCE: Great American Financial
Resources, Inc. CONTACT: Mark F. Muething, Executive Vice President
of Great American Financial Resources, Inc., +1-513-333-5515 Web
site: http://www.gafri.com/ http://www.ceresgp.com/
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