State Farm to sell Canadian businesses
Thursday, January 16, 2014 11:16 AM
State Farm Mutual Automobile Insurance Co. announced Wednesday it has agreed to sell its Canadian property/casualty, life, mutual fund, loan and living benefits companies to Montreal-based Desjardins Group, Insurance & Technology reported. As part of the agreement, State Farm will make a $450 million (Canadian) investment in nonvoting preferred shares into the property/casualty business after the deal closes, which will include the newly acquired State Farm Canada property and casualty operations, so Desjardins can operate them under a licensing agreement. As a result of the transaction, Desjardins Group will become the second largest P&C insurance provider in Canada with annual gross written premiums of approximately $3.9 billion, up from approximately $2 billion. The deal, subject to conditions, is expected to close in a year.