Fidelity & Guaranty Life Files for IPO of Up to $100 Million
August 29, 2013 by Ben Fox Rubin
Fidelity & Guaranty Life filed for an initial public offering for up to $100 million, which the company plans to use to pay a dividend to its owner and build up capital to support its growth.
The company, currently owned by Harbinger Group Inc. (HRG), offers various types of fixed annuities and life insurance products and had about 700,000 policyholders as of late June. The company said its most popular products right now are fixed indexed annuities, which provide customers with interest tied to the performance of the stock market, while limiting the risk of losing money should the stock market decline. In 2012, FIAs generated about 95% of the company’s total sales.
Fidelity plans to use the money raised to pay a dividend to Harbinger, as well as for working capital and other general corporate needs.
For the nine months ended June 30, the company reported income of $237 million, up from $116.9 million in the same period a year earlier. Revenue jumped 19% to $1.03 billion.
Write to Ben Fox Rubin at ben.rubin@wsj.com