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A.M. Best Places Credit Ratings of Santa Lucía S.A. Compañía de Seguros y Reaseguros Under Review With Developing Implications

A.M. Best has placed under review with developingimplications the Financial Strength Rating of A- (Excellent) and the Long-TermIssuer Credit Rating of "a-" of Santa Lucía S.A. Compañía de Seguros y Reaseguros (SantaLucia) (Spain), the operating holding company of the Santa Lucia group.

The Credit Ratings (ratings) action follows the announcementon 10 May 2017, of the acquisition of Aviva Vida y Pensiones, S.A. de Seguros yReaseguros and AvivaPlc's 50% stake in pension joint ventures, Unicorp Vida, Compañíade Seguros y Reaseguros, S.A. and Caja España Vida, Compañía de Seguros yReaseguros SA, by Santa Lucía. The transaction is subject to regulatory andantitrust approvals, and A.M. Best expects it to close in the fourth quarter of2017.

The under review with developing implications statusreflects that while the acquisition is anticipated to improve Santa Lucía'smarket profile and enhance underlying earnings, it is expected to weaken thecompany's balance sheet strength over the short term. Furthermore, thesignificance of the transaction creates execution risk, and its successfulnesswill be dependent on the company's ability to integrate a material lifeoperation into its profile.