The transaction is expected to close in early 2012. Harleysville will continue to operate under its brand name. Its current headquarters in Harleysville, Pa., will "serve as an integral part of the combined company’s national, independent agency-based platform," the companies said in a statement.
For its part, Nationwide said it's looking to increase its commercial lines footprint by buying Harleysville. Harleysville wrote nearly $700 million in commercial lines premium in fiscal year 2010. Among Nationwide's subsidiaries that write commercial coverage, Scottsdale Insurance Company's website says it has "more than $2 billion in annual sales" of excess and surplus lines. Nationwide Agribusiness wrote $428.7 million in premium in FY 2008 (the latest year for which Insurance & Technology could find data).
“This combination brings together two best-in-class companies that share a mutual heritage and a focus on meeting the long-term needs of our policyholders,” Nationwide CEO Steve Rasmussen, says in a statement. “With Harleysville’s expertise in commercial lines and Nationwide’s complementary geographic distribution, there will be a substantial opportunity to increase market share, while also providing our combined agents and customers access to a broader portfolio of insurance, financial and banking products."
The acquisition also broadens Nationwide's portfolio of independent-agent-sold insurance. Nationwide currently sells through independent agents via its Allied subsidiary.
"We remain committed to our trusted independent agency partners and to the independent agency system," Harleysville president and CEO Michael Browne says in a statement. "I am confident that the combined organization will allow us to deliver the best products and services available to grow our independent agents’ books of business with us more effectively and efficiently."