NU Online News Service, April 20, 11:45 a.m.EDT

Michigan insurers Auto Club Insurance Association (ACIA) andFremont Michigan InsuraCorp Inc. have agreed to merge.

ACIA will buy all of Fremont shares for a cash price of about$67.7 million, or about $36.15 per share.

“The breadth of Fremont's product offerings, distribution ofbusiness in the western and northern parts of Michigan,long-standing relationships with independent agencies, and robustfinancial performance will immediately benefit the enterprise,”says Charles H. Podowski, president and CEO of ACIA, in astatement.

Sardar Biglari, CEO of Biglari Holdings, which is the parentcompany of Steak n Shake restaurants, had previously attempted to purchaseMichigan-exclusive property and casualty insurer Fremont. Aholder of nearly 10 percent of Fremont stock, Biglari supports themerge.

“I have enjoyed working with [Fremont] in our effort to realizethe full value of Fremont's shares,” he says. “The merger with ACIArepresents a victory for all Fremont stockholders.”

Richard E. Dunning, Fremont president and CEO, says ACIA plansto maintain the Fremont franchise and its executive offices inFremont, Mich. Dunning says ACIA will “work with Fremont toincrease its independent-agency distribution in the state ofMichigan and surrounding states.”

Rating agency A.M. Best Co. says it spoke to Fremont about thetransaction and evaluated the capitalization and business plan. Theratings outlook for the company remains stable.

Dearborn, Mich.-based ACIA, a reciprocal-insurance exchange, isan affiliate of AAA Auto Club Group and provides a wide range ofpersonal-lines products.

Fremont Michigan InsuraCorp Inc. is the holding company forFremont Insurance Co. The company provides P&C insurance toindividuals, farms and small business in Michigan.