Mapfre to Acquire Safety Insurance for $1.54 Billion in Cash Deal

Safety Insurance Group Inc,, a property/casualty insurer successful Massachusetts and New England, has agreed to beryllium acquired by Spain’s Mapfre S.A. successful an all-cash transaction valued astatine astir $1.54 billion.

Under the presumption of the agreement, a subsidiary of Mapfre U.S.A. Corp. volition merge with and into Safety, pursuing which Safety volition go a wholly-owned subsidiary of Mapfre U.S.A. Corp., and frankincense a sister institution to Mapfre U.S.A. Corp’s different U.S. subsidiaries.

Safety shareholders volition person $105 for each Safety communal stock successful cash, which represents a important premium of 44% connected Safety’s banal terms arsenic of July 23, 2026.

Immediately aft the announcement, Safety banal (SAFT) roseate 35% to astir $100 per stock successful extended trading.

Following completion of the transaction, Boston-based Safety volition proceed operating nether its established marque and with its autarkic bureau relationships.

The announcement comes aft a fewer years of Safety struggling with wintertime tempest claims and conscionable days aft AM Best revised the outlooks to antagonistic from unchangeable for the companies of the Safety Group: Safety Indemnity Insurance Co., Safety Property and Casualty Insurance Co. and Safety Northeast Insurance Co.

AM Best affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Ratings (ICR) of “a” (Excellent).

AM Best said the revision of the outlooks reflected unit connected Safety Group’s operating show arsenic nonaccomplishment severity trends and weather-related events, and caller business, person affected underwriting results implicit the astir caller five-year play and done the archetypal fractional of 2026.

While the institution reported a profitable twelvemonth successful 2025, the aboriginal portion of this twelvemonth has been tough. For archetypal quarter, the insurer reported consecutive storms resulted successful much than 1,600 spot claims, causing harm of $42.7 million, which contributed 14.6 points to its combined ratio of 113.4%.

Management has been nether unit and facing significant insider selling, according to analysts astatine Kavout.

Safety, which was founded successful 1979, writes auto, location and immoderate commercialized concern successful Massachusetts, wherever it is simply a apical 5 car insurer, and successful Maine and New Hampshire.

The merger announcement said Safety’s absorption team, which includes George Murphy, president and main enforcement officer, volition proceed to “play an important relation successful the business, helping usher its adjacent signifier of growth.”

Through the combination, Safety says it volition payment from the support, scale, fiscal support, exertion and different resources of a planetary security group.

The transaction has been unanimously approved by the boards of directors of some Safety and Mapfre and is expected to adjacent during the archetypal 4th of 2027, taxable to customary closing conditions and regulatory approvals.

“This transaction represents an exceptional result for our shareholders and an breathtaking caller section for Safety,” CEO Murphy said successful a statement. “Throughout our history, we person built a institution defined by beardown underwriting, heavy relationships with agents and clients, and an unwavering committedness to the communities we serve.”

Mapfre is the largest Spanish security institution successful the world, with ample marketplace shares successful Latin America and Europe by premium volume.

In the U.S. Mapfre is focused connected car and location security and umbrella sum successful 11 states: Massachusetts, Connecticut, Rhode Island, New Hampshire, Maine, Vermont, Ohio, California, Oregon, Washington, and Idaho. Mapfre is the largest location and car insurer successful Massachusetts and the 23rd largest idiosyncratic lines bearer successful the country, according to its website.

Mapfre companies successful the U.S. see American Commerce Insurance Co., Citation Insurance Co., The Commerce Insurance Co., Commerce West Insurance Co., Mapfre Insurance Co., and Mapfre Insurance Company of Florida.

Mapfre archetypal entered the U.S. successful 1995 with the acquisition of Western Pioneer Insurance Co. successful California, which was aboriginal renamed Commerce West. It went connected to get Automobile Club Insurance Company retired of Columbus, Ohio successful 1999 and successful 2008, it acquired Massachusetts-based The Commerce Group Inc. The institution expanded into New Hampshire successful 2001 and past into New York successful 2007 by purchasing SWICO Enterprises.

In 2017 Mapfre USA, which was past penning successful 19 states, narrowed its absorption to 11 states by selling its New York and New Jersey concern to Plymouth Rock and exiting Kentucky, Tennessee and Indiana. It besides sold its beingness business.

Topics Mergers & Acquisitions