MADISON, Wis. - American Family Insurance announced Friday it is pursuing a merger with Florida-based The Main Street America Group.
The companies’ boards of directors approved the merger, which will improve diversity of risk, promote growth through geographic expansion and provide agents and policyholders broad product offerings, according to a release from American Family.
There are no planned employee or operational changes at either company, American Family Insurance media relations consultant Erin Johansen said in an email to News 3.
"It will be business as usual. Main Street America will operate as a stand-alone company, much like our affiliates The General and Homesite," Johansen said.
Both companies are financially strong mutual holding companies, and the merger does not involve either company paying for any assets or financially covering any capital, officials said.
The merger will allow American Family Insurance to reach more customers through broader product offerings and geographic expansion, Johansen said.
"(The merger) also adds to our financial strength, so we can protect customers and invest in programs, research and services that could benefit them," Johansen said.
The companies have national distribution capabilities, but each focuses on regional coverage, according to the release.
“This merger will give policyholders – particularly small business owners – more insurance products to choose from and more ways to buy them,” Jack Salzwedel, chairman and CEO of the American Family Insurance group, said in the release. “Given our focus on policyholders and agents, that’s a win.”
“Both companies are able to immediately take advantage of our unique marketplace positions, as well as the ability to bring new value to each of our agency distribution systems,” Tom Van Berkel, Main Street America’s chairman, president and CEO, said in the release. “Our ability to sell new products through our independent agent-customers will help us and our agents profitably grow, while simultaneously bringing American Family enterprise products to a different policyholder base.”
The merger is expected to close by the end of the year, and will require approval by mutual policyholder members of both companies and state insurance regulators, according to the release.
Greater Madison Chamber of Commerce President Zach Brandon released the following statement today in response to the announced merger between American Family Insurance and Florida-based The Main Street America Group:
“This is terrific news for American Family Insurance and their ability to reach new markets while supporting current policyholders. This is just the latest in a recent string of strategic investments and innovative acquisitions that have positioned the company for continued growth and success. We are excited about the deal, its expanded choices for small business owners and the significant potential it represents for the future of one of this region’s true community leaders.”
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