Allstate Corp. said Monday it had agreed to acquire privately held Squaretrade Inc., which sells warranties for electronic products, in a deal worth about $1.4 billion.
"This acquisition expands Allstate's customer relationships with 25 million protection plans for consumer electronics and connected devices," said Tom Wilson, chief executive at Allstate.
Squaretrade is backed, in part, by Boston-based Bain Capital.
Allstate will acquire SquareTrade with its cash and by issuing debt, the company said in a prepared statement. The transaction is expected to be a drag on Allstate's per-share earnings for three years. The deal is pending regulatory approvals, among other closing conditions.
Shares of Allstate slipped 1.4% to $71 in after-hours trading.
SquareTrade has been a disruptive force in the sector because of its online sales model, pricing and the information it provides about failure rates of products. It was founded in 1999 as a website that mediated disputes between eBay Inc. buyers and sellers.
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(END) Dow Jones Newswires
November 28, 2016 18:05 ET (23:05 GMT)
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