CONTACTS:
FOR IMMEDIATE RELEASE
OLDWICK, N.J. - JULY 08, 2002 12:00 AM (EDT)
A.M. Best Co. views the proposed merger between Farm Bureau Mutual Insurance Company (a pooled member of the Farm Bureau Group of Iowa), Des Moines, Iowa, Farm Bureau Mutual Insurance Company, Inc. (a member of the Kansas Farm Bureau Group), Manhattan, Kansas and Farm Bureau Insurance Company of Nebraska, Lincoln, Nebraska, as one that will add value to the companies, provide enhanced geographic diversification and improve products and services. The financial strength rating of A (Excellent) for each company remains unaffected by the proposed merger.
These three mutual companies have signed a memorandum of understanding to merge operations and are working toward finalizing a definitive agreement. This merger is contingent upon regulatory approval and is expected to close during the first quarter of 2003.
The Farm Bureau Group of Iowa is comprised of Farm Bureau Mutual Insurance Company and Western Agricultural Insurance Company, and currently operates predominantly in Iowa, Minnesota, South Dakota, Utah, Arizona and New Mexico. All insurance companies in the Farm Bureau Group of Iowa are managed by FBL Financial Group, Inc. (NYSE: FFG). Western Agricultural Insurance Company is owned by 12 Farm Bureau related entities, each owning 7.69% of the outstanding voting stock except Farm Bureau Mutual which owns 15.4%. The Kansas Farm Bureau Group is comprised of Farm Bureau Mutual Insurance Company, Inc., and its fully reinsured subsidiary, KFB Insurance Company.
The merger will enhance the companies' excellent capitalization and favorable liquidity position. Also, the merger will enhance the current regional and single market presence and gain greater economies of scale as $600 million in direct written premiums will be generated for the companies.
A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source.