By Ezequiel Minaya
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. Thedeal 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 17:59 ET (22:59 GMT)
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