Farm Bureau Property & Casualty Insurance Company has completed the process of taking a sister company, FBL Financial Group Inc., private. It is paying $61 per share for all FBL Financial stock held by investors outside the Farm Bureau corporate family, according to a notice filed with the SEC.
The deal means that FBL Financial no longer will have to give investors quarterly or annual reports, and that the company's executives no longer will have to explain to securities analysts why new accounting rules, combined with use of derivatives, sometimes lead to large swings in revenue and net earnings.
The deal will not have any direct impact on the FBL Financial subsidiaries that write the company's life insurance and annuities, and it might not have much effect on operations, because Farm Bureau P&C and FBL Financial already operate out of the same headquarters offices in West Des Moines, Iowa.
Farm Bureau P&C and FBL Financial's life insurance company subsidiaries will still have to file quarterly and annual reports with state insurance regulators.
The History
Farmers and people who support farmers joined to form the Iowa Farm Bureau Federation in 1918. The federation started Farm Bureau P&C in 1939, and it started Farm Bureau Life Insurance Company in 1944.
The federation turned FBL Financial into a public company in 1999, by selling a minority stake in the company to the public through an initial public offering.
Farm Bureau P&C now provides coverage for 360,000 people in eight states in the West and Midwest through a network of about 900 agents and agency managers.
FBL Financial has been managing two Farm Bureau P&C insurance company subsidiaries for a management fee. FBL reported a $2.6 million net loss for the first quarter on $135 million in revenue. The company's annuity unit reported $53 million in revenue, and its life insurance unit reported $107 million in revenue.
