NU Online News Service, Jun 27, 7:22 p.m. – The Aid Association for Lutherans, Appleton, Wis., and the Lutheran Brotherhood, Minneapolis, say they hope to merge by the end of the year.
The executives of the fraternal benefit societies want to join forces to combine the strength of the two societies in a bigger, even stronger organization, and continue the societies’ “Christian framework,” according to the statement announcing the proposed merger.
If the merger is completed, the combined society would have 7,100 employees, 3 million members and $60 billion in assets under management.
The combined society would have a corporate center in Minneapolis, and an operations center in Appleton.
John Gilbert, chairman of the Aid Association, would be the chairman of the combined society.
Bruce Nicholson, president of the Lutheran Brotherhood, would be the president of the combined society.
The societies need approval from insurance regulators, the Lutheran Brotherhood’s 300 member delegates, and the Aid Association’s board.
Standard & Poor’s, New York, put out an analysis praising the societies and the proposed merger.
“Both companies have very strong business positions, extremely strong capitalization, very strong operating performance, and excellent management within their chosen market,” S&P says.
If the societies merge, they should benefit from economies of scale, S&P predicts.
S&P notes that both societies have faced tough competition for new business, and exposed themselves to some stock market-related risk by selling variable annuities and proprietary mutual funds.
A combined society should be in a better position to compete, S&P says.