AM Best Comments on Credit Ratings of Sun Life Financial, Inc. and Its Subsidiaries Following Announced Acquisition of DentaQuest
OLDWICK, N.J.--(BUSINESS WIRE)--Oct 4, 2021--
AM Best has commented that the Credit Ratings (ratings) of Sun Life Financial, Inc. (Sun Life) and its subsidiaries remain unchanged following the Oct. 4, 2021, announcement that it has reached a definitive agreement to acquire DentaQuest, the largest provider of Medicaid dental benefits in the United States, for approximately CAD 3.1 billion (USD 2.47 billion).
Sun Life expects to fund the acquisition with a combination of cash (40%) and subordinated debt (approximately 60%). Sun Life’s financial leverage is expected to remain well within AM Best guidelines following the acquisition at approximately 28%. AM Best expects Sun Life’s interest coverage to remain healthy, as the acquisition is expected to be immediately accretive to earnings. AM Best notes that Sun Life had expanded its presence in the U.S. dental insurance space previously with the acquisition of Assurant, Inc.’s employee benefits business in 2016. The acquisition of DentaQuest will increase the company’s scale and market share in the U.S. dental insurance market significantly, while enabling it to access the growing government programs segment.
This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.
Copyright © 2021 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
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KEYWORD: NEW YORK NEW JERSEY EUROPE UNITED STATES NORTH AMERICA
INDUSTRY KEYWORD: OTHER PROFESSIONAL SERVICES PROFESSIONAL SERVICES INSURANCE
SOURCE: AM Best
Copyright Business Wire 2021.
PUB: 10/04/2021 01:47 PM/DISC: 10/04/2021 01:47 PM