ST. LOUIS, April 26 /PRNewswire/ -- UniGroup, Inc. has
reached a definitive agreement to sell its subsidiary, Vanliner
Insurance Company to National Interstate Insurance Company, a
Richfield, Ohio based specialty
property and casualty insurance provider. National Interstate
Insurance Company is the principal subsidiary of National
Interstate Corporation (Nasdaq: NATL). Vanliner, which is
headquartered in suburban St.
Louis, is a market leader in providing insurance for the
moving and storage industry.
The sale has been approved by the Board of Directors of all
involved parties. The deal, which is subject to customary closing
conditions and regulatory approvals, is expected to close in the
second quarter of 2010.
Under the agreement, National Interstate will pay approximately
$125-$135 million in cash, which
represents Vanliner's tangible book value at closing. The purchase
price may be adjusted after closing based on Vanliner's final
closing date balance sheet. As part of the definitive agreement,
UniGroup has agreed to provide National Interstate with
comprehensive financial guarantees related to the runoff of
Vanliner's balance sheet following the close. While providing
comprehensive financial guarantees to National Interstate, the
financial guarantees also provide that favorable development of the
closing balance sheet, for example, settlement of insured losses at
amounts less than provided for on the closing balance sheet, will
benefit UniGroup. Vanliner wrote approximately $104 million of gross moving and storage premiums
in 2009, representing 58% of its total business.
At the closing, National Interstate and UniGroup will enter into
a five-year agreement whereby Vanliner will remain the exclusively
endorsed insurance provider for UniGroup's affiliated Mayflower
Transit and United Van Lines moving and storage agents. Vanliner
will continue to operate from its current offices.
Richard H. McClure, President of
UniGroup said, "The sale of Vanliner is the result of a
comprehensive strategic review of UniGroup and its various
businesses. As a part of National Interstate, Vanliner, its
customers and its employees will have even greater opportunities
for growth in the future. Similarly, the capital provided by the
transaction will support the future growth of UniGroup and its
network of United Van Lines and Mayflower Transit agents across the
U.S."
"We established Vanliner as an industry leader by providing
specialized insurance for movers and we are confident that National
Interstate, with its financial resources and proven results as a
specialty insurer, will maintain and strengthen Vanliner's quality
standards, high levels of customer service and strong reputation,"
McClure said.
Dave Michelson, President and
Chief Executive Officer of National Interstate said, "We have been
looking at potential acquisitions for some time. We feel that
Vanliner is an obvious extension of our successful specialty niche
business model and the moving and storage business complements our
existing insurance products. Combining Vanliner's expertise in the
moving and storage industry with National Interstate's proven
underwriting and claims skills will help ensure continued
profitable growth for the business."
Michelson added, "We saw both a business and cultural fit
between our organizations. At National Interstate we have always
focused our efforts on providing unique and specialized insurance
solutions and service for our customers. We are excited about this
opportunity to build on the success that Vanliner has enjoyed using
an approach that is very consistent with ours."
Macquarie Capital acted as financial advisor to UniGroup on the
transaction.
About Vanliner: Vanliner Insurance Company is
headquartered in Fenton, Mo., a
suburb of St. Louis. The company
was formed in 1978 and is licensed in all 50 states to provide an
insurance solution to affiliated moving and storage agents of its
parent, UniGroup, Inc. In the mid 1990's, Vanliner began offering
coverages to non- affiliated agents and today is one of the premier
providers of insurance products for the moving and storage
industry.
About National Interstate: National Interstate
Corporation (NASDAQ: NATL), founded in 1989, is a specialty
property and casualty insurance holding company with a niche
orientation and focus on the transportation industry. We
differentiate ourselves by offering insurance products and services
designed to meet the unique needs of targeted insurance buyers. Our
products include insurance for transportation companies,
alternative risk transfer, or captive insurance programs for
commercial risks, specialty personal lines consisting of insurance
products focused primarily on recreational vehicle owners and small
commercial vehicle accounts, and transportation and general
commercial insurance in Hawaii and
Alaska. We offer our insurance
products through multiple distribution channels including
independent agents and brokers, affiliated agencies and agent
Internet initiatives. Our insurance subsidiaries are rated "A"
(Excellent) by A.M. Best Company. Headquartered in Richfield, Ohio, National Interstate is an
independently operated subsidiary of Great American Insurance
Company, a property and casualty subsidiary of American Financial
Group, Inc. (NYSE/Nasdaq: AFG).
Melissa
Sullivan
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UniGroup,
Inc.
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636-349-2508
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Melissa_Sullivan@unigroupinc.com
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Tanya
Inama
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National Interstate
Corporation
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877-837-0339
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investorrelations@nationalinterstate.com
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SOURCE UniGroup, Inc.