Acacia Mutual And Ameritas Mutual Say Merge

Acacia Mutual Holding Company of Wasington, D.C. and Ameritas Mutual Insurance Holding Company of Lincoln, NE have announced their intent to form an affiliation of their respective mutual holding companies, merging them to form Ameritas Acadia Mutual Holding Company.

The Boards of Directors of both companies approved this week what they say is the first ever merger of two mutual insurance holding companies. The deal is subject to regulatory approvals and a favorable member vote, expected later this year.

The firms believe their affiliation will create a stronger, more diversified company. The new organization will have almost $11 billion assets under management, GAAP insurance assets of $6 billion, $21 billion life insurance inforce, more than $750 million in revenues and approximately $750 million GAAP equity/capital.

Ameritas Chairman and CEO Larry Arth, stated that the proposed affiliation "creates a partnership where two strong and growing companies join together, with diversified product lines that are complementary and fit our strategic vision of the future. Together we can leverage our respective areas of expertise to create a stronger organization, which will be better able to compete in tomorrow's dynamic market place."

Tuck Nason, chairman and CEO of Acacia, commented that "the affiliation of the two mutual holding companies would serve as a 'model' organizational combination that is unique in the industry, providing the opportunity for enhancing critical mass and achieving economies of scale for both organizations, while retaining separate insurance company corporate identities and brand names in the marketplace going forward."

Although Ameritas Life and Acacia Life will remain stock subsidiary companies to the holding company, maintaining their respective domiciliary states and executive office locations, they intend to benefit from forming a combined service company/division that will offer administrative and operational support services to both insurance organizations. They expect improved unit costs, more effective product development, and better technologies for customer service as a result of this initiative.

Arth will become chairman and CEO, with Nason as vice chairman and president of the newly formed mutual holding company, with both individuals retaining their respective titles and responsibilities at the subsidiary company levels within the holding company.

The Ameritas companies had approximately $3.5 billion GAAP assets, $430 million GAAP revenue, and $461 million GAAP equity as of December 31, 1997. Ameritas and its subsidiaries specialize in variable life, fixed and variable annuities, group dental, low load insurance products and 401K and other investment products.

The Acacia Group has $2.3 billion GAAP assets, $7.1 billion assets under management, $291 million revenue and $260 million GAAP equity as of December 31, 1997. Acacia and its related subsidiaries offer traditional life and annuities, as well as variable products, special banking products and services, a variety of mutual funds, and operate a full service financial planning broker dealer.