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AM Best Comments on Credit Ratings of Sun Life Financial, Inc. and Its Subs. Following Announced Acquisition of DentaQuest.

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ENPNewswire-October 5, 2021--AM Best Comments on Credit Ratings of Sun Life Financial, Inc. and Its Subs. Following Announced Acquisition of DentaQuest

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Release date- 04102021 - AM Best has commented that the Credit Ratings (ratings) of Sun Life Financial, Inc. (Sun Life) and its subsidiaries remain unchanged following the Oct. 4, 2021, announcement that it has reached a definitive agreement to acquire DentaQuest, the largest provider of Medicaid dental benefits in the United States, for approximately CAD 3.1 billion (USD 2.47 billion).

Sun Life expects to fund the acquisition with a combination of cash (40%) and subordinated debt (approximately 60%). Sun Life's financial leverage is expected to remain well within AM Best guidelines following the acquisition at approximately 28%. AM Best expects Sun Life's interest coverage to remain healthy, as the acquisition is expected to be immediately accretive to earnings. AM Best notes that Sun Life had expanded its presence in the U.S. dental insurance space previously with the acquisition of Assurant, Inc.'s employee benefits business in 2016. The acquisition of DentaQuest will increase the company's scale and market share in the U.S. dental insurance market significantly, while enabling it to access the growing government programs segment.

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