Liberty Mutual Agency Markets Unit Files for Public Offering

May 11, 2010

Boston-based Liberty Mutual Group today announced that its subsidiary, Liberty Mutual Agency Corp. (LMAC), consisting of substantially all of the operations currently conducted by its Agency Markets strategic business unit, has filed a registration statement with the U.S. Securities and Exchange Commission for an initial public offering of shares of its common stock.

The transaction requires review by the SEC, which Liberty Mutual expects will be completed in the third quarter of 2010.

LMAC offers personal and commercial lines of insurance to individuals and small to mid-sized businesses, as well as surety bonds, through independent agents.

Liberty Mutual Group will own at least 80 percent of LMAC following the initial public offering and maintain a significant controlling interest going forward, while other shareholders will own up to 20 percent.

The status of Liberty Mutual Holding Co. Inc. (LMHC) as a mutual holding company will be unaffected by this proposed transaction. Similarly the status of the other companies in the Liberty Mutual Group will be unchanged.

“A publicly traded subsidiary representing a portion of our business offers us access to public equity markets and increases our overall financial flexibility to help us achieve our longer-term strategic objectives,” said Edmund F. Kelly, Liberty Mutual Group chairman, president and chief executive officer.

LMHC is a mutual holding company that was formed by the reorganization of its three principal mutual insurance companies which became separate stock insurance companies in 2001 and 2002. LMHC conducts substantially all of its business through four strategic business units: Personal Markets, Commercial Markets, Agency Markets and International. Each business unit operates independently of the others and has dedicated sales, underwriting, claims, actuarial, financial and certain information technology resources.

Citi and BofA Merrill Lynch will act as joint book-running managers for the proposed offering.

Source: Liberty Mutual

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