Lehman Brothers Collection - Contemporary Business Archives

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Twentieth-Century Business Archives

Gulf Life Holding Company - Lehman Brothers Collection

Gulf Life Holding Company

List of Deals

The Gulf Life Holding Company was organized in Florida in 1968 as a parent company of the Gulf Life Insurance Company. The Gulf Life Holding Company was incorporated to control the Gulf Life Insurance Company, to raise capital, and to complete acquisitions of other companies. Just after the Holding Company's inception, Gulf Life Insurance acquired the Stonewall Insurance Company from Greatamerica Corporation (a 95 percent owned subsidiary of Ling-Temco-Vought [LTV]) for $15 million in cash, with the intention of transferring Stonewall to the Holding Company. At the same time, the Holding Company engaged in a stock swap with Gulf Life Insurance in order to acquire Gulf Enterprises, Inc., which was a holding company for Atlantic Discount Company, Inc., and Pixie Shops, Inc., both of Florida. The Holding Company also purchased 57 percent of the outstanding common stock of the American-Amicable Life Insurance Company, a life insurance corporation from Alabama, at a cost of $48 million.

The Gulf Life & Accident Insurance Company was incorporated in 1911 in Florida. The company was renamed in 1926 as the Gulf Life Insurance Company. Gulf Life issued whole-life, term, and endowment policies, as well as annuities and accident and health insurance from its office in the Gulf Life Tower in Jacksonville, Florida. In 1967 most policies were written in Florida, Georgia, Tennessee, and Alabama. In the exchange offer of 1968, Gulf Life Insurance transferred 80 percent of its outstanding common stock to the Gulf Life Holding Company. Gulf Life Insurance had a pro forma net income of $4.58 million in 1967.

Founded in 1866, Stonewall Insurance was the oldest Alabama insurance company, issuing policies for fire and casualty insurance. It later shifted its focus to auto insurance. Greatamerica purchased the company in 1964 from American. Stonewall's subsidiaries included Dixie Auto Insurance Company and Specialty Underwriters. Stonewall had $14.6 million in admitted assets in 1967, up from $3.6 million in 1963. Dixie auto had admitted assets of $3.45 million in 1967, with $1.68 million in 1963.

Gulf Life founded Gulf Enterprises in 1968 for the purpose of holding Atlantic Discount Company and Pixie Shops. Atlantic Discount was a small loan and automobile sales financing company. Assets in 1967 were $26 million, with gross revenues of $4.6 million and net income of $270,000. Pixie Shops offers franchises girls' and women's apparel shops. In 1967, 130 Pixie Shops were in operation, with sales of $2 million and net income of $175,000.

The Gulf Life Holding Company continued to acquire common stock in American-Amicable and in Gulf Life Insurance through a voluntary exchange program for stock that ran from 1968 through 1970. The Holding Company's net income for 1969 reached $13.8 million, up from $4.94 million in the previous year.

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