FBL Financial Group, Inc. (NYSE: FFG)
today announced a 36 percent increase in the quarterly cash dividend to $0.15 per share, a special cash dividend of $2.00 per share, a tender offer for 99 percent of its Class B common shares and the intent to repay $50 million of affiliate debt.
“The return of cash to shareholders via the special one-time dividend and the increased regular quarterly cash dividend reinforces our belief in the strength of our Farm Bureau Life business and our commitment to deploy its strong cash generation in an effective and efficient manner,” said James P. Brannen, Chief Executive Officer of FBL Financial Group, Inc. “Even with these capital transactions, our balance sheet remains very strong, with considerable financial strength, which allows for the financial flexibility to take advantage of opportunities as they arise.”
Special Dividend of $2.00 Per Share.
FBL Financial Group’s Board of Directors has declared a special, one-time cash dividend of $2.00 per share payable on September 13, 2013 to Class A and Class B common stockholders of record as of September 6, 2013. The total amount of the special dividend payment is estimated to be approximately $51 million.
Quarterly Dividend Increase to $0.15 Per Share.
FBL Financial Group’s Board of Directors has declared a quarterly cash dividend of $0.15 per share, payable on September 30, 2013 to Class A and Class B common stockholders of record as of September 13, 2013. This represents a 36 percent increase from the prior quarterly dividend of $0.11 per share paid during June 2013, and reflects an annual dividend rate of $0.60 per share.
Tender Offer of Class B Shares.
FBL Financial Group’s Board of Directors has authorized the repurchase of Class B common shares of up to $56.5 million. The repurchases will be effected by a tender offer for 99 percent of all Class B shares outstanding, conditioned upon participation by all Class B stockholders. The tender price will be based upon the average of the closing price of FBL’s Class A common stock for the seven consecutive business days preceding the tender closing date of September 25, 2013. The average closing price notwithstanding, there will be a floor under the repurchase price of $45 per share, and a ceiling on the repurchase price of $50 per share. Assuming the special, one-time cash dividend of $2.00 per share is paid prior to the closing date of the tender offer, then the floor price and ceiling price would be reduced by the $2.00 special dividend amount.
To preserve current voting rights as to matters subject to a vote by Class B shareholders, the repurchase will take place only if all Class B stockholders participate in the tender or agree to have their pro rata share of Class B shares converted to Class A prior to the tender. Additionally, this transaction is conditioned upon approval by the Iowa Insurance Division of a dividend from Farm Bureau Life Insurance Company to the holding company.