Canada’s Kingsway Financial Services, Inc. has agreed to acquire Mendota Insurance Co., a wholly owned subsidiary of The St. Paul Travelers Companies, Inc. The transaction includes Mendota’s wholly owned subsidiaries, Mendakota Insurance Co. and Mendota
Insurance Agency, Inc.
Mendota is the dedicated non-standard automobile insurance operation of St. Paul Travelers. The company is licensed in 43 states and currently writes business in 20 states through a network of about 6,000 independent agency locations. Mendota is headquartered in St. Paul, Minnesota and in calendar year 2006 wrote approximately $175 million of non-standard automobile premiums.
Bill Star, president and chief executive officer of Kingsway, said the acquisition is consistent with his firm’s strategy to become a dominant player in the non-standard automobile market in the United States.
The transaction is scheduled to be completed following regulatory approvals. Terms of the transaction were not disclosed.
The Toronto-based company said the purchase price will be funded through internal sources, a portion of which may include Kingsway’s existing undrawn credit facilities.
Kingsway Financial Services Inc. is one of the largest truck insurers and non-standard automobile insurers in North America. The company currently operates through eleven wholly-owned insurance subsidiaries in Canada and the U.S. Canadian subsidiaries include Kingsway General Insurance Co., York Fire & Casualty Insurance C. and Jevco Insurance Co.
Its U.S. subsidiaries include Universal Casualty Co., American Service Insurance Co., Southern United Fire Insurance Co., Lincoln General Insurance Co., U.S. Security Insurance Co., American Country Insurance Co., Zephyr Insurance Co. and Avalon Risk Management, Inc.
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