S&P's Prudential ratings unaffected

Standard & Poor's said its ratings on Prudential Financial Inc. (A/stable/A-1) are not affected by the announcement that Prudential and Allstate Corp. (A+/negative/A-1) have reached a definitive agreement for Prudential to reinsure the variable annuity business of Allstate's life unit, Allstate Financial, and for Prudential to be the exclusive provider of variable annuities through Allstate's exclusive agency channel.

The projected proceeds for the transaction are about $580 million and are subject to adjustment for market changes for the period between the execution date of the agreement and the closing date. The agreement is subject to regulatory approval, and the transaction is expected to be completed by the end of the second quarter of 2006.

S&P said the proposed transaction reflects a continuation of Prudential's existing strategy to increase its scale in its core insurance businesses.

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