Aflac Inc. says Japan Post Holdings Co. Ltd. simply wants to invest $2.6 billion in Aflac stock, not acquire Aflac.
Aflac put out a press release about Japan Post’s plans Thursday, after some news organizations reported that Japan Post might acquire Aflac.
(Related: Aflac Says Its Agents Are Selling More)
Aflac confirmed that it is engaged in discussions with Japan Post Holdings.
Japan Post Holdings would invest in Aflac by buying stock through open market purchases, Aflac said.
“The discussions do not involve Aflac Incorporated or any of its subsidiaries becoming a member of the Japan Post Group,” Aflac said. “No assurance can be given that any transaction will occur or agreement will be reached.”
Aflac does not intend to make any further press releases or announcements regarding the negotiations unless a definitive agreement has been reached or discussions have ended, the company said.
What Is Aflac?
Aflac is a Columbus, Georgia-based insurer that sells life insurance, supplemental health insurance products and other products in the United States and Japan.
The supplemental health market has been highly competitive in recent years, because insurers see that market as being relatively resistant both to the effects of low interest rates on insurance company investment earnings and to the turmoil in the U.S. major medical insurance regulatory framework.
The company reported $845 million in net income for the third quarter on $5.6 billion in revenue.
The company’s market capitalization value — the value of all of its stock, or the current price a buyer might, theoretically, pay for the whole company — is about $34 billion, according to share number data from Aflac and stock price data from the New York Stock Exchange.
A $2.6 billion investment in Aflac stock would amount to about 8% of Aflac’s market cap.
What Is Japan Post?
Japan Post is a Tokyo-based postal services and financial services giant that started out as an arm of the Japanese government.