Torchmark Announces Spinoff of Waddell & Reed

Oct 16, 1998, 01:00 ET from Torchmark Corporation

    BIRMINGHAM, Ala., Oct. 16 /PRNewswire/ -- Torchmark Corporation
 (NYSE:   TMK), announced today that it has received from the Internal Revenue
 Service a tax ruling favorable to Torchmark's proposed tax free distribution
 of all its shares of Waddell & Reed Financial, Inc. (NYSE:   WDR) common stock
 to Torchmark shareholders.  As a result, on November 6, 1998, Torchmark will
 distribute the Waddell & Reed shares to Torchmark shareholders of record as of
 October 23, 1998.  For each 10 Torchmark shares held, Torchmark shareholders
 will receive approximately 3 shares of Waddell & Reed.
     Torchmark currently holds 8.0 million of the 32.1 million outstanding
 shares of Waddell & Reed's Class A common stock and all of the 34.3 million
 outstanding shares of Waddell & Reed's Class B common stock.  On the
 distribution date, each Torchmark shareholder of record will receive a
 combination of Waddell & Reed Class A and Class B common shares in the same
 proportion as currently held in the aggregate by Torchmark.  Accordingly, for
 each Torchmark share held as of October 23, 1998, a Torchmark shareholder will
 receive .0569 share of Waddell & Reed Class A common stock and .2447 share of
 Waddell & Reed Class B common stock.  Torchmark shareholders will be paid cash
 in lieu of any fractional Waddell & Reed shares that result from this
     Torchmark also announced today that the Board of Directors has declared a
 cash dividend on the Company's outstanding common stock of record held as of
 the close of business on October 23, 1998, to be paid on October 30, 1998.
 The third quarter 1998 cash dividend is a total of $0.13 per share consisting
 of $0.09 per share attributable to Torchmark common shares and $0.04 per share
 attributable to the Waddell & Reed common shares to be distributed to
 Torchmark shareholders on November 6, 1998.  Waddell & Reed's declared third
 quarter 1998 dividend is $0.1325 per Waddell & Reed share and, as described
 above, Torchmark shareholders will receive about 3 shares of Waddell & Reed
 for each 10 shares of Torchmark they hold.  As a result, the portion of this
 quarter's dividend payable from Torchmark that is attributable to the newly
 distributed Waddell & Reed shares is $0.04 per Torchmark share
 ($0.1325 x 3/10).  In the future, Waddell & Reed shareholders will receive
 dividends on all of the Class A and Class B shares directly from Waddell &
 Reed, and Torchmark shareholders will receive cash dividends from Torchmark
 attributable only to Torchmark common stock.
     As a result of the spinoff, the operating results of Waddell & Reed will
 be reclassified as "discontinued operations" in Torchmark's financial reports
 for all previous financial periods.  Torchmark disclosed that total costs
 related to the completion of the spinoff were approximately $53 million,
 including the previously disclosed $50 million corporate tax expense.  These
 costs will be reflected in "discontinued operations" in Torchmark's third
 quarter 1998 earnings report.
     Torchmark emphasized that it will reactivate its share repurchase program
 subsequent to the Waddell & Reed distribution and may, from time to time,
 purchase Torchmark shares both in the open market and in privately negotiated
 transactions as market conditions warrant.  As in the past, share repurchases
 are an important part of Torchmark's program to enhance shareholder value.

SOURCE Torchmark Corporation