PEORIA, Ill.--(BUSINESS WIRE)--
RLI Corp. (NYSE:RLI) – RLI Corp. announced today that it will acquire
Contractors Bonding Insurance Company (CBIC) through an acquisition of
its holding company, Data and Staff Service Co. (DSS) for approximately
$137 million in cash. The acquisition is subject to regulatory approval
and expected to close in the first quarter of 2011.
CBIC is a privately held, Seattle-based insurance company specializing
in surety bonds and related niche property and casualty insurance
products. The company serves over 30,000 contractors and over 4,000
insurance agents and brokers nationwide. CBIC operates 13 regional
branch offices and is considered a leading writer of contractor license
bonds in the Northwest.
“CBIC has a track record of success and provides new market and product
expansion opportunities for RLI,” said Jonathan E. Michael, President &
CEO of RLI Corp. “The company’s geographic footprint, underwriting
philosophy, and culture align well with RLI’s business. We anticipate
that the acquisition will be accretive to earnings within the first year
of ownership.”
For the nine months ending September 30, 2010, CBIC’s GAAP financial
results included total assets of $270 million and total revenue of $45
million. At closing, we expect shareholder’s equity to approximate $108
million. CBIC is rated A (Excellent) by A.M. Best Company and has
achieved an underwriting profit in 13 of the last 14 years.
“This acquisition combines the strength, financial stability and
experience of two successful specialty insurance companies,” said Mr.
Michael. “CBIC’s excellent reputation with its producers, and the unique
product offerings that it brings to RLI, will add value to our business.
We look forward to working with CBIC’s talented team.”
RLI is a specialty insurance company serving niche or underserved
markets. With a diverse portfolio of property and casualty coverages and
surety bonds, it has achieved an underwriting profit in 29 of the last
33 years, including the last 14. RLI and subsidiaries – RLI Insurance
Company, Mt. Hawley Insurance Company and RLI Indemnity Company – are
rated A+ "Superior" by A.M. Best Company and A+ "Strong" by Standard &
Poor's. RLI operates in all 50 states from office locations across the
country.
All forward-looking statements made in this press release related to
RLI’s anticipated acquisition reflect RLI’s current views with respect
to future events, business transactions and business performance in
connection with the acquisition, and are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of
1995. Such statements involve risks and uncertainties, which may cause
actual results to differ materially from those set forth in these
statements. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the dates on which
they are made, and are encouraged to review general risk factors
identified in the company’s filings with the Securities and Exchange
Commission. The company undertakes no obligation to publicly update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
For additional information, contact John Robison, Treasurer and Chief
Investment Officer, at (309) 693-5846 or at john.robison@rlicorp.com
or visit our website at www.rlicorp.com.
Source: RLI Corp.
Contact:
RLI Corp.
John Robison
(309) 693-5846
John.Robison@rlicorp.com
www.rlicorp.com