BURLINGTON, ON, Sept. 17 2009 – Co-operators Life Insurance Company (Co-operators Life) and Central 1 Credit Union (Central 1) today announced an agreement to acquire The CUMIS Group Limited (CUMIS), subject to regulatory, shareholder and court approvals and other standard closing conditions. This transaction would result in a strong, Canadian-owned supplier of insurance products and services to Canadian credit unions and their members.
Based on December 31, 2008 consolidated financial statements, the purchase price will be approximately C$232 million. The final purchase price will be determined based on closing audited financial statements for 2009 subject to final closing adjustments.
CUMIS provides a full range of personal insurance, including credit and mortgage protection; life; disability and critical illness; home; auto; travel and employee benefits. It also provides business, liability and property insurance to credit unions themselves, as well as wealth management services and products, including credit union group retirement plans. All existing CUMIS insurance policies remain in effect with no changes.
Co-operators Life is a wholly-owned subsidiary of The Co-operators Group Limited (The Co-operators). For 23 years, The Co-operators and CUMIS have had a joint insurance business venture, through which CUMIS provides insurance products and services to approximately 450 Canadian credit unions and caisses populaires, and their more than five million members.
Co-operators Life, based in Regina, Saskatchewan, and Central 1, headquartered in Vancouver, B.C., intend to acquire 100 per cent of the issued and outstanding shares of CUMIS, pending required approvals. CUNA Mutual Group, based in Madison, Wisconsin, currently holds 87.4 per cent of the shares of CUMIS, and fully supports this transaction. The transaction is expected to close on or about December 31, 2009. Upon completion of the transaction and execution of agreements between The Co-operators and Central 1, The Co-operators will own approximately 63.8 per cent to 73 per cent of CUMIS and Central 1 will own approximately 23.6 per cent to 27 per cent of CUMIS.
“Our longstanding relationships with both CUMIS and Central 1, together with our shared commitment to the co-operative and credit union sector, make this a natural fit for The Co-operators,” said Kathy Bardswick, President and CEO of The Co-operators. “As a Canadian-owned co-operative, we welcome the opportunity to forge even closer relationships with, and to provide quality insurance-related services to, credit unions and their members.”
“This investment fits well with our vision and we are pleased to partner with The Co-operators in this business opportunity,” said Don Rolfe, President and CEO of Central 1. “This acquisition will allow us to ensure credit unions and their members receive efficient service and affordable insurance products. It also diversifies our revenue sources.”
“As the leading provider of insurance-related products and services to the Canadian credit union system outside Quebec, CUMIS has been focused on helping credit unions protect themselves and their members for more than 70 years,” said Kenn Lalonde, President and CEO of CUMIS.
“The Co-operators, Central 1 and CUMIS share strong co-operative values along with a commitment to community and to the credit union system. This deal can only enhance our ability to continue to meet and exceed our customers’ expectations.”
“The time is right for all of the organizations involved to make this move,” said Jeff Post, President and CEO of CUNA Mutual. “For CUNA Mutual, it improves our flexibility to diversify and pursue new avenues for growth. For the Canadian companies involved, it joins three organizations with like-minded values and a long-time commitment to the Canadian credit union system.”
In addition to her role as President and CEO of The Co-operators Group, Kathy Bardswick will become CEO of CUMIS on closing of this deal.
About Co-operators Life:
Co-operators Life Insurance Company, with its head office in Regina, is a part of The Co-operators – a group of Canadian companies offering home, auto, life, group, travel, commercial and farm insurance, as well as investment products. The Co-operators Group Limited is a 100 per cent Canadian-owned co-operative with assets of more than CDN $7 billion. It is owned by a group of Canadian co-operatives, credit union centrals and like-minded organizations. The Co-operators is well known for its community involvement, and is listed among the 50 Best Employers in Canada. www.cooperators.ca.
About Central 1:
With CDN $9.5 billion in assets, Central 1 Credit Union is the central liquidity management facility and trade association for its nearly 200 member credit unions in B.C. and Ontario. From offices in Vancouver, B.C., and Mississauga, Ont., more than 500 employees provide a wide range of services, including liquidity management, payments settlement, Internet financial services and trade association functions. More information about Central 1 is available at www.sedar.com.
CUMIS partners with credit unions to deliver competitive insurance and financial solutions. In doing so, it creates financial security and promotes the growth and success of the credit union system in Canada. Its principal companies are CUMIS Life Insurance Company and CUMIS General Insurance Company. CUMIS also has a 50 per cent interest in CUIS Brokerage Services Limited and Credential Financial Inc. CUMIS has management responsibility for its joint insurance business venture with The Co-operators, which offers an integrated portfolio of both organizations’ insurance products and related services to credit unions under the banner of “CUMIS Insurance in partnership with The Co-operators.”
About CUNA Mutual:
CUNA Mutual Group is a leading provider of financial services to credit unions, their members and valued customers worldwide. With more than 70 years of commitment to credit unions, CUNA Mutual’s vision is unwavering: to be a trusted partner who delivers service excellence and customer-focused, best-in-class products and market-driven innovation. More information on the company is available on the company’s Web site at www.cunamutual.com.