State Farm has agreed to sell its insurance business in Canada to Desjardins Group.
The deal will make Desjardins the second-largest property and casualty insurer in Canada with premiums of $3.9 billion a year, according to a joint statement from the companies.
Bloomington-based State Farm, the largest property and casualty insurer in the U.S., will invest in non-voting preferred shares of Desjardins as part of the deal. Desjardins will use the State Farm brand under license.
State Farm’s 1,700 Canadian employees and network of more than 500 Canadian agents will continue to serve over 1.2 million customers in Ontario, Alberta and New Brunswick.
“This acquisition will allow Desjardins to develop a broader, multi-channel distribution network across the country, while continuing to meet the needs of State Farm’s Canadian client base. At the same time, it will enhance our position in Canada by expanding our customer reach and achieving economies of scale,” said Monique F. Leroux, board chair, president and CEO of Desjardins Group.
Edward B. Rust Jr., State Farm chairman and CEO, said, “Desjardins Group’s strategic vision, rooted in a cooperative mission and customer-focused values, strongly aligns with State Farm’s mission and values creating opportunities for exploring further cooperation in Canada in the future.”
h/t Chicago Tribune
