Donegal Group’s board has approved a new capital structure, including the consolidation of six subsidiary insurance companies into three in an effort to reduce operating expenses.
The board is also eyeing a one-for-three reverse split of the company’s outstanding common stock and the reclassification of the common stock as Class B common stock. Also under consideration is the authorization of a new class of common stock designated as Class A common stock with one-tenth of a vote per share.
Each of these actions by the board is subject to approval at the company’s annual meeting of stockholders April 19. Should it be approved, the reverse stock split and the stock dividend, each current DGI stockholder will continue to have the same relative voting power in DGI and the same total number of DGI shares (two-thirds of which will be Class A and one-third of which will be Class B).
The company anticipates that distribution of certificates representing the Class A common stock and the Class B common stock will be made on April 30, 2001.
Donegal Group is a regional property/casualty insurance holding company doing business in 15 Mid-Atlantic and Southern states through its insurance subsidiaries.
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