Prosperity Life Group to acquire National Western Life Group in $1.9bn deal

In a strategic move set to reshape the insurance landscape, National Western Life Group, Inc. (NASDAQ:NWLI) and Prosperity Life Group have announced the signing of a definitive Merger Agreement. In this monumental deal, S. USA Life Insurance Company, Inc. (“SUSA”), an affiliate of Prosperity Life Group, will acquire National Western Life Group in an all-cash transaction valued at an impressive $1.9 billion.

The terms of the deal will see each issued and outstanding share of National Western Life Group common stock converted into the right to receive $500 in cash upon the merger’s completion. This price per share offers an 87.1% premium to the Class A Common Stock share price as of May 16, 2023, and an 11.8% premium over National Western Life Group’s 30-day average as of October 6, 2023. Notably, the merger has secured the unanimous nod from National Western Life Group’s Board of Directors.

Nicholas von Moltke, Prosperity Life Group’s President and CEO, expressed his enthusiasm, “The acquisition of National Western is a landmark in our insurance business expansion. We are keen on integrating National Western’s capabilities to offer our policyholders unparalleled value.” On the other side of the deal, Ross R. Moody, National Western’s CEO, voiced his optimism, emphasizing the significant value this merger offers to stockholders.

The merger is on track for completion in the first half of 2024, awaiting approvals from National Western’s stockholders, antitrust clearances, and other customary regulatory green lights. National Western stockholders, representing almost 29.7% of total voting power, have confirmed their support for the merger, with an agreement to vote in favor of the Merger Agreement.

Details of the proposed acquisition will be publicly available through a report filed by National Western Life Group with the U.S. Securities and Exchange Commission (SEC). The Merger Agreement’s funding comprises cash from internal sources, a capital commitment from affiliates of Elliott Investment Management L.P., and potential debt commitments.

Assisting Prosperity Life Group and SUSA in this acquisition are Citi as the financial advisor and Debevoise & Plimpton LLP as the legal advisor. Conversely, National Western Life Group has engaged Goldman Sachs & Co. LLC for financial advisory services and Sidley Austin LLP as their M&A counsel.