In a deal that will make the Boston, Mass.-based insurer the fifth largest P&C carrier in the United States, Liberty Mutual announced today that it has entered into an agreement to acquire Seattle-based Safeco for an estimated $6.2 billion.
Following the transaction, Safeco will become part of Liberty Mutual Group's Agency Markets business unit, a group that had revenues of $5.6 billion in 2007. James McGlennon, named CIO of Liberty Mutual Agency Markets in June 2007, will oversee technology for the combined organization. McGlennon is currently working on Agency Markets' integration with Ohio Casualty, a Fairfield, Ohio-based insurer acquired by Liberty Mutual last May.
"The addition of Safeco significantly expands and strengthens the Liberty Mutual Group," Edmund F. Kelly, Liberty Mutual Group chairman, president and chief executive officer said in a press release. "Safeco's operations and product mix complement our existing Agency Markets operations. Additionally, both organizations have superb Surety businesses which when combined will form the second largest Surety business in the United States."
In 2007, Liberty Mutual reported direct written premium of $20.2 billion, while Safeco reported $5.9 billion. The acquisition is subject to approval by Safeco's shareholders as well as the customary regulatory approvals and conditions.