United Fire & Casualty announces new holding company structure

United Fire Group will will replace United Fire & Casualty Co. as the publicly held corporate structure for the Cedar Rapids-based insurance business under a plan announced Wednesday, May 25.

United Fire & Casualty said it will ask shareholders at an unspecified date later this year year to vote on a reorganization plan that will, in effect, replace United Fire as the publicly held corporation.

Under the plan, United Fire will become the subsidiary of United Fire Group. United Fire shareholders will become shareholders of the new United Fire Group holding company. Each outstanding share of United Fire common stock will automatically be converted to one share of United Fire Group common stock.

The reorganization will be tax-free to shareholders, the company said, and shareholders will hold the same number of shares and the same ownership percentage as they did prior to the reorganization.

Improved strategic, business, financing and regulatory flexibility were factors in the decision by United Fire's board of directors and management to recommend the holding company structure.

"Under this structure, we would operate as a holding company as most of the companies inour industry operate - we are one of a very few insurance companies that do not operate with a holding company structure," United Fire president and CEO Randy Ramlo said. "Using the name "United Fire Group" formalizes the name we have operated under for many years."