Liberty Mutual to Buy AGF’s Chilean Subsidiary

August 20, 2004

Boston-based Liberty Mutual Group will further expand its Latin American insurance business with the purchase of the insurance operations of AGF Allianz Chile S.A., a unit of France’s AGF, which is in turn a division of Germany’s Allianz AG.

The companies have notified regulatory authorities of the transaction, which is effective immediately. The purchase price disclosed is 39 million euros ($47 million).

The acquisition gives Liberty an entry into the Chilean insurance market. The Group plans to rename the company Liberty Seguros, and said it would “offer a full range of property and casualty products for commercial and personal customers.” Liberty currently operates the leading insurance companies in Venezuela and Colombia, and has a significant presence in Brazil and Argentina.

“Chile is a very attractive market and this acquisition fits very well into our Latin American strategy,” stated Edmund F. Kelly, Liberty’s Chairman, President and CEO. “This is an opportunity to acquire a market leader with a reputation for quality service and innovation.”

Liberty Mutual Group’s international operations are managed through its strategic business unit, Liberty International, which provides “distinctive insurance and reinsurance products and services in the following 17 countries: Argentina, Australia, Brazil, Canada, China, Colombia, France, Germany, Hong Kong, Ireland, Portugal, Singapore, Spain, Thailand, the United Kingdom, Venezuela and Vietnam. ”

The division’s gross written premium has grown from $190 million in 1994 to $4 billion in 2003. “Liberty International provides its insurance products and services through two distinct approaches,” said the announcement. “The first is through wholly owned insurance companies in foreign countries, which provide mostly personal insurance products and services. The second approach is through Liberty International Underwriters (LIU), which provides specialty commercial lines of insurance worldwide, including casualty, specialty casualty, marine, energy, engineering and reinsurance.”

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