UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934
Date of Report (Date of earliest event reported): January 2, 2004
Donegal Group Inc.
(Exact name of registrant as specified in its charter)
Delaware 0-15341 23-02424711
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
1195 River Road, Marietta, Pennsylvania 17547
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including areacode: 717-426-1931
N/A
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(Former name or former address, if changed since last report)
Item 5. Other Events.
On January 2, 2004, Donegal Group Inc. (the "Company") issued
a press release, a copy of which is filed as Exhibit 99.1 hereto, announcing the
acquisition of all of the outstanding capital stock of Le Mars Insurance Company
("Le Mars"), the successor to Le Mars Mutual Insurance Company of Iowa following
its conversion to a stock insurance company pursuant to a plan of conversion.
The Company acquired the capital stock of Le Mars for approximately $12.5
million.
Le Mars operates as a multiple line carrier in Iowa, Nebraska,
Oklahoma and South Dakota. Personal lines coverages represents a majority of
premiums written, with the balance coming from farmowners and mercantile and
service businesses. Le Mars' largest line of business is private passenger
automobile liability and physical damage; other principal lines include
homeowners and commercial multi-peril.
On January 6, 2004, the Company issued a press release, a copy
of which is filed as Exhibit 99.2 hereto, announcing the January 6, 2004
acquisition of all of the outstanding common stock of The Peninsula Insurance
Company ("Peninsula Insurance") and Peninsula Indemnity Company ("Peninsula
Indemnity") from Folksamerica Holding Company, Inc. pursuant to a Stock Purchase
Agreement. The purchase price of approximately $23.3 million was a cash payment
equal to 107.5% of the consolidated GAAP stockholders' equity of Peninsula
Insurance and Peninsula Indemnity as of the date of closing of the acquisition.
Peninsula Insurance and Peninsula Indemnity are each
Maryland-domiciled insurance companies headquartered in Salisbury, Maryland that
write primarily private passenger automobile coverages, and also write
homeowners, commercial multi-peril, workers' compensation and commercial
automobile coverages. The principal operating area of Peninsula Insurance and
Peninsula Indemnity is Maryland, Delaware and Virginia.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
See Exhibit Index.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DONEGAL GROUP INC.
By:__________________________
Donald H. Nikolaus, President
And Chief Executive Officer
Date: January 16, 2004
EXHIBIT INDEX
Exhibit No. Description Reference
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99.1* Press Release issued by Donegal Group Inc. dated January 2, Filed herewith.
2004.
99.2* Press Release issued by Donegal Group Inc. dated January 7, Filed herewith.
2004.
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* This press release shall not be deemed to be filed for the purposes of
Section 18 of the Securities Exchange Act of 1934 or incorporated by
reference in any filing under the Securities Act of 1933.
Exhibit 99.1
DONEGAL GROUP ACQUIRES LE MARS INSURANCE COMPANY
Ralph G. Spontak
Senior Vice President and Chief Financial Officer
Phone (717) 426-1931
Fax (717) 426-7009
For Immediate Release
MARIETTA, Pennsylvania, January 2, 2004 - Donegal Group Inc. (Nasdaq
DGICA and DGICB) today reported that it had completed the previously announced
acquisition of all of the outstanding capital stock of an affiliated company, Le
Mars Mutual Insurance Company of Iowa, following the conversion of Le Mars to a
stock insurance company for approximately $12.5 million.
Le Mars operates as a multiple line carrier in Iowa, Nebraska, Oklahoma
and South Dakota. Personal lines coverages represent a majority of premiums
written, with the balance coming from farmowners and mercantile and service
businesses. Le Mars' largest line of business is private passenger automobile
liability and physical damage; other principal lines include homeowners and
commercial multi-peril.
Donald H. Nikolaus, President and Chief Executive Officer of Donegal
Group stated "An important part of our strategy is the selective acquisition of
property and casualty insurers to augment our organic growth in our existing
markets and expand into selected geographic regions. The Le Mars acquisition is
the first step in the expansion of our operations to the Midwest."
Donegal Group Inc. is a property and casualty insurance holding company
whose insurance subsidiaries offer personal and commercial lines of insurance to
businesses and individuals in six Mid-Atlantic states (Connecticut, Delaware,
Maryland, New York, Ohio and Pennsylvania), eight Southeastern states (Alabama,
Arkansas, Georgia, Louisiana, North Carolina, South Carolina, Tennessee and
Virginia) and four Midwestern states (Iowa, Nebraska, Oklahoma and South
Dakota).
All statements contained in this release that are not historic facts
are based on current expectations. Such statements are forward-looking (as
defined in the Private Securities Litigation Reform Act of 1995) in nature and
involve a number of risks and uncertainties. Actual results could vary
materially. Among the factors that could cause actual results to vary materially
include: the ability of the Company to maintain profitable operations, the
adequacy of the Company's reserves for losses and loss adjustment expenses,
business and economic conditions in the Company's primary operating areas,
competition from various insurance and non-insurance businesses, terrorism,
legal and judicial developments, changes in regulatory requirements and other
risks that are described from time to time in the periodic reports the Company
files with the Securities and Exchange Commission. Undue reliance should not be
placed on any such forward-looking statements.
Exhibit 99.2
DONEGAL GROUP ACQUIRES PENINSULA INSURANCE GROUP
Ralph G. Spontak
Senior Vice President and Chief Financial Officer
Phone (717) 426-1931
Fax (717) 426-7009
For Immediate Release
MARIETTA, Pennsylvania, January 6, 2004 - Donegal Group Inc. (Nasdaq
DGICA and DGICB) today reported that it had completed the previously announced
acquisition of all of the outstanding capital stock of The Peninsula Insurance
Company and Peninsula Indemnity Company from Folksamerica Holding Company, Inc.
for approximately $23.0 million in cash.
Peninsula operates as a multiple line carrier, primarily in Maryland,
Delaware and Virginia. Personal lines coverages represent a majority of premiums
written, with the balance coming from mercantile and service businesses.
Peninsula's largest line of business is private passenger automobile liability
and physical damage; other principal lines include homeowners and commercial
multi-peril.
Donald H. Nikolaus, President and Chief Executive Officer of Donegal
Group stated "An important part of our strategy is the selective acquisition of
property and casualty insurers to augment our organic growth in our existing
markets and expand into selected geographic regions. We believe the Peninsula
acquisition will enhance our market position and agency representation in the
Mid-Atlantic states while enabling us to leverage certain expenses over a
greater premium base and consolidate various reinsurance costs in the future."
Donegal Group Inc. is a property and casualty insurance holding company
whose insurance subsidiaries offer personal and commercial lines of insurance to
businesses and individuals in six Mid-Atlantic states (Connecticut, Delaware,
Maryland, New York, Ohio and Pennsylvania), eight Southeastern states (Alabama,
Arkansas, Georgia, Louisiana, North Carolina, South Carolina, Tennessee and
Virginia) and four Midwestern states (Iowa, Nebraska, Oklahoma and South
Dakota).
All statements contained in this release that are not historic facts
are based on current expectations. Such statements are forward-looking (as
defined in the Private Securities Litigation Reform Act of 1995) in nature and
involve a number of risks and uncertainties. Actual results could vary
materially. Among the factors that could cause actual results to vary materially
include: the ability of the Company to maintain profitable operations, the
adequacy of the Company's reserves for losses and loss adjustment expenses,
business and economic conditions in the Company's primary operating areas,
competition from various insurance and non-insurance businesses, terrorism,
legal and judicial developments, changes in regulatory requirements and other
risks that are described from time to time in the periodic reports the Company
files with the Securities and Exchange Commission. Undue reliance should not be
placed on any such forward-looking statements.