AM Best Places Credit Ratings of Vision Service Plan and Its Subsidiaries Under Review with Developing Implications

OCTOBER 22, 2024 11:39 AM (EDT)

AM Best Places Credit Ratings of Vision Service Plan and Its Subsidiaries Under Review with Developing Implications

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FOR IMMEDIATE RELEASE

OLDWICK - OCTOBER 22, 2024 11:39 AM (EDT)
AM Best has placed under review with developing implications the Financial Strength Rating (FSR) of A- (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICRs) of "a-" (Excellent) of Vision Service Plan (Rancho Cordova, CA) and its subsidiaries, collectively known as VSP Vision. (See below for a detailed listing of the subsidiaries.)

The Credit Ratings (ratings) of VSP Vision and its subsidiaries were placed under review with developing implications following the announcement that VSP Vision has entered into a definitive agreement to acquire Eyemart Express, a national optical retailer.

Eyemart Express is ranked as the 12th largest eyewear retailer in the United States, with nearly 250 retail locations across 42 states. The acquisition will increase the size and geographic reach of VSP Vision's retail vision network. Eyemart Express will provide VSP Vision with an additional source of unregulated revenue and cash flow, as well as broaden VSP Vision's footprint with stores in rural and traditionally underserved communities. However, the transaction is expected to create a significant amount of goodwill and intangibles, which may place pressure on VSP Vision's balance sheet strength assessment. The transaction is subject to regulatory approval and is expected to close by first quarter of 2025. The ratings of VSP Vision will remain under review with developing implications pending further discussions with its management regarding the financial and operational implications of the transaction and regulatory approval.

The FSR of A- (Excellent) and the Long-Term ICRs of "a-" (Excellent) have been placed under review with developing implications for the following subsidiaries of VSP Vision:

· Eastern Vision Service Plan, Inc.

· VSP Vision Care, Inc.

· Vision Service Plan Insurance Company (OH)

· Vision Service Plan of Illinois, NFP

· Vision Service Plan Insurance Company (MO)

· Vision Service Plan (CA)

This press release relates to Credit Ratings that have been published on AM Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best's Credit Ratings, Best's Performance Assessments, Best's Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best's Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.