Fitch: Prudential Fin'l's Agreement to Buy Allstate's Variable Annuity Business...

CHICAGO -- Prudential Financial Inc.'s (PFI) agreement to buy the variable annuity business of Allstate Corporation (The) is within ratings expectations for the company, according to Fitch Ratings.

Fitch views the proposed transaction as well-structured as PFI will be assuming primarily

insurance liabilities through a reinsurance transaction. The acquisition will add scale and complementary distribution to PFI's existing variable annuity operations with little integration risk. The additional capital needed to support the acquired business is modest and well within PFI's capabilities. The volatility associated with the guaranteed features of Allstate's variable annuity products are expected to be managed using the same hedging strategies PFI uses on its in-force variable annuities.

PFI's issuer default rating is currently 'A+' with a Stable Outlook.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.