Kemper to Acquire American Access Casualty in Illinois for $370M

Specialty insurer, Kemper Corp., has agreed to acquire American Access Casualty Co, and its related captive insurance agency, Newins Insurance Agency Holdings LLC, and its subsidiaries (collectively “AAC”). AAC is headquartered in Downers Grove, Ill.

The $370 million transaction is expected to close in the first quarter of 2021, subject to regulatory approval and other customary closing conditions.

AAC provides specialty private passenger auto insurance in Arizona, Illinois, Indiana, Nevada and Texas. AAC wrote over $370 million of direct premiums in 2019 through a network of approximately 500 independent agents and over 110 captive agents. AAC’s multi-channel distribution strategy, agency relationships, and ties to the markets it serves — particularly Hispanic communities — have driven strong growth and consistent profitability.

Duane Sanders, president of Kemper’s P&C Division, said ACC will complement Kemper’s specialty auto franchise.

The transaction is expected to be accretive to Kemper’s earnings per share (EPS) and return on tangible common equity in the first year, excluding value of business acquired and one-time items, and result in high single-digit EPS accretion in the second year, excluding restructuring and one-time items. Tangible book value per share is expected to return to pre-transaction levels within the first year following the close of the transaction.

A presentation outlining additional information related to the transaction is available online in the Investors section of kemper.com.

Sidley Austin LLP served as legal counsel for Kemper. Piper Sandler & Co acted as financial advisor to AAC and Winston & Strawn LLP served as legal counsel for AAC.

Source: Kemper Corp.

Topics Mergers & Acquisitions Illinois Casualty