CUNA MUTUAL ACQUIRES FULL OWNERSHIP OF CROP INSURER PROAG Acquisition Supports Company’s Diversification, Growth Strategies and ProAg’s Growth Objectives
FOR IMMEDIATE RELEASE
September 3, 2009
MADISON, Wis./AMARILLO, Tex…. CUNA Mutual Group has reached agreement with Producers Ag Insurance Group (ProAg) to become sole owner of the multi-peril crop insurer, serving farmers and agricultural producers nationwide.
ProAg will operate as a standalone subsidiary of CUNA Mutual. The acquisition supports CUNA Mutual’s need to identify new growth opportunities and diversify the risks it insures. The agreement with the Amarillo, Texas based insurer will also enhance CUNA Mutual’s flexibility and financial strength while enabling ProAg to continue to expand its business.
“This acquisition builds on the initial investment we made in ProAg in 2007,” said Jeff Post, President & CEO, CUNA Mutual. “It in no way affects our commitment to credit unions. For us to continue to strengthen and diversify our financial position, we need to identify new avenues for growth.”
“In looking for new opportunities to build on our expertise and continue to strengthen our financial position, crop insurance and our recent acquisition of CPI Qualified Plan Consultants were naturals,” added Post. “These acquisitions build off our core competencies, help diversify our business, and provide revenue streams that give us flexibility to invest and grow in the future.
CUNA Mutual’s relationship with ProAg began in 2006 when it began serving as the lead reinsurer for ProAg as a direct writer of crop insurance. In 2007, CUNA Mutual acquired a minority ownership position in ProAg.
Since its partnership was formed with CUNA Mutual in 2006, ProAg has grown from a 70 employee company doing business in 25 states to a 390 employee company serving more than 40 states. ProAg is on pace to generate more than $530 million in premium in 2009.
“ProAg has been the fastest growing crop insurer this decade,” said ProAg Chairman and CEO Ben Latham. “CUNA Mutual’s support of our growth as a reinsurer and minority shareholder, as well as their commitment to our way of doing business, makes them the natural provider of the institutional support we need to reach our goals of becoming a market leader.
“I am excited about the possibilities for this company my family has spent more than 80 years building,” Latham added.
“We are excited having ProAg become part of the CUNA Mutual family,” added Post. “The Lathams have built ProAg into one of the premier crop insurance operations in the business.” Crop insurance protects farmers from financial losses that result from natural causes such as drought, excessive moisture, hail, wind, frost, insects and disease. Multi-Peril Crop Insurance (MPCI) is an $8 billion industry in the U.S.
ProAg is a provider of federally sponsored MPCI and private Crop Hail Insurance. For more than 80 years, ProAg has served farmers and agents, while becoming an industry leader in the technology critical to today’s marketplace. ProAg is the 6th largest writer of MPCI and the 5th largest writer of crop hail coverage in the country. For more information, visit www.proag.com.
ProAg was advised by SFRi LLC (www.sfrillc.com), a boutique merchant banking firm serving the insurance and risk management industries.
CUNA Mutual Group is a leading provider of financial services to credit unions, their members and valued customers worldwide. With more than 70 years of market commitment, CUNA Mutual’s vision is unwavering: to be a trusted business partner who delivers service excellence and customer focused, bestin- class products. More information on the company is available on the company’s Web site at www.cunamutual.com.
For more information:
Jim Buchheim 608/232-6327
Rick Uhlmann 608/231-8940
Benson Latham 806/372-6785