Sentry buys non-standard auto insurer The General from American Family for $1.7 billion

Sentry Insurance said it is buying non-standard auto insurer The General from American Family Insurance for about $1.7 billion, marking the largest acquisition in the company’s 120-year history.

Sentry will pay $1.1 billion in cash and assume debt and equity to bring the total transaction to $1.7 billion. American Family acquired The General in 2012 when it bought PGC Holdings Corp. and its subsidiaries for $239 million.

Stevens Point, Wis.-based mutual insurer Sentry said it is known for business insurance, but also has a non-standard auto, motorcycle and off-road insurer under its Dairyland brand that serves customers through its network of independent agents. The acquisition of Nashville-based direct-to-consumer (DTC) The General “brings together two of the strongest brands in the non-standard automotive industry,” said Pete McPartland, president and CEO of Sentry.

Sentry said the brands will operate independently during the integration process. The approximately 1,300 employees at The General will join Sentry’s workforce of 5,000 on Jan. 1 and will continue to be based in Nashville.

“We have found a strategic and cultural fit in Sentry, where The General’s growth and momentum will continue,” said American Family Insurance CEO Bill Westrate. “We are confident that Sentry’s expertise, strong reputation in this market and culture of employment will not only continue to serve The General’s customers well, but will also ease the transition for The General’s employees.”

The transaction is expected to close by the end of the year, pending regulatory approvals.

Related: AM Best: Adverse results persist for non-standard cars

In late August, American Family Insurance Group’s Main Street America Insurance said it would stop offering personal lines insurance in favor of a commercial lines strategy.

TOPICS
Mergers and acquisitions Auto Carriers