HOUSTON and CHATTANOOGA, Tenn., Dec. 8 /PRNewswire/ -- American General
Corporation (NYSE: AGC) and Provident Companies, Inc. (NYSE: PVT) today
jointly announced the signing of a definitive agreement under which an
American General affiliate will acquire Provident's in force individual and
tax-sheltered annuity business.  The companies also have entered into
preliminary reciprocal marketing agreements whereby American General will
market Provident's individual disability products, and Provident will market
American General's individual annuity products.
    The purchase price to be paid by American General is $58 million.  The
annuities being acquired by American General represent $2.4 billion of
statutory reserves.  The transaction, which is subject to requisite regulatory
approvals and certain other conditions, is expected to close by March 31,
1998.
    In commenting on the transaction, Robert M. Devlin, chairman and chief
executive officer of American General, said, "The acquisition of Provident's
portfolio of individual annuities expands our presence in one of the fastest
growing segments of the financial services industry.  We also believe that the
marketing agreements between American General and Provident will present
significant opportunities for both companies in providing additional financial
products to customers through expanded distribution channels.  Also, we look
forward to offering Provident's portfolio of disability insurance products to
our broad customer base."
    J. Harold Chandler, chairman, president and chief executive officer of
Provident, said, "Focusing on the growth opportunities in the disability
marketplace is a top priority for Provident.  This agreement will allow us to
more fully concentrate our capital and other resources on our core disability
operations while continuing to serve the needs of our producers and individual
customers with annuity products from an industry leader.  American General
represents a strong marketing partner as we expand our disability sales
through its financial institutions marketing agreements and American General's
large middle-market agency sales force."
    The in force business being acquired consists primarily of single-premium
fixed annuities and tax-sheltered annuities in Provident Life and Accident
Insurance Company, Provident National Assurance Company, The Paul Revere Life
Insurance Company, and The Paul Revere Variable Annuity Life Insurance
Company.  In addition, American General is acquiring a number of miscellaneous
group pension lines of business sold in the 1970's and 1980's, which are no
longer actively marketed.  The sale does not include Provident's block of
traditional guaranteed investment contracts (GICs), or group single premium
annuities, which will continue in a run-off mode.
    Provident Companies, Inc., is North America's leading provider of
disability insurance and related products for individual and corporate
customers.  Provident is committed to delivering value through disability
products that meet customer needs, claims handling focused on returning people
to work, and highly responsive service for customers and their advisors.  With
shareholders' equity of $3.1 billion, Provident common stock is listed on the
New York Stock Exchange.
    American General is one of the nation's largest diversified financial
services organizations with assets of $79 billion and shareholders' equity of
$7.3 billion.  Headquartered in Houston, it is a leading provider of
retirement services, life insurance, and consumer loans to 12 million
customers.  American General common stock is listed on the New York, Pacific,
London, and Swiss stock exchanges.

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