In an update to definitive agreements announced with Atlanta-based Cotton States Insurance Group in December 2003, COUNTRY Insurance & Financial Services has filed the required Form A with the Georgia Insurance Department to seek approval of the proposed transactions.
The Form A, Statement Regarding the Acquisition or Change in Control of Cotton States Life, Cotton States Mutual, and Shield Insurance Company, prepared and filed by COUNTRY, includes various exhibits, details of the transactions and explains why the parties believe the two transactions meet Georgia statutory requirements. Other required filings are being made by COUNTRY in Illinois and Connecticut.
The first transaction between COUNTRY and Cotton States Insurance involves the merger of Cotton States Life Insurance Company with a subsidiary of COUNTRY Life Insurance Company, under which Cotton States Life Insurance stockholders will receive $20.25 cash for each share of outstanding common stock of Cotton States Life Insurance Company. As a result, Cotton States Life
Insurance Company will become a privately held company.
The second transaction establishes a property/casualty alliance between Cotton States Mutual Insurance Company and the COUNTRY property/casualty insurance pool. The Alliance Agreement calls for the business of Cotton States Mutual Insurance Company to be combined with the business of the COUNTRY property/casualty pool, which allows the entire pool to share proportionally in the earning and loss results.
It is anticipated that, if approved by the stockholders of Cotton States Life, the transactions will close in the second quarter of 2004, with exact timing dependent on regulatory approval. Typically, once the Form A is filed and deemed complete by the Georgia Department of Insurance, a public hearing is held within 30 days and the Commissioner of Insurance delivers a decision within 30 days of the hearing.
Cotton States Life Insurance Company has tentatively scheduled a stockholder meeting for April 27, at the company’s home office in Atlanta. Stockholders of Cotton States Life Insurance Company will receive a proxy statement prior to that meeting.
Topics Carriers Georgia Property Casualty
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