Liberty Mutual Agency Corp. expects to raise about $1.2 billion through an initial public offering, according to a filing with the U.S. Securities and Exchange Commission.

The stock will be traded under the NASDAQ symbol LMAC.

LMAC–a unit of Boston-based Liberty Mutual Group–said it would offer 64.3 million shares for between $18 and $20 per share. If demand is great, up to six million more shares could be offered.

LMAC consists of all of the operations conducted by Liberty Mutual's Agency Markets unit, comprised of property and casualty and specialty insurance carriers that distribute products and services through independent agents and brokers.

The stock offering is divided into two classes.

o Class A shares of common stock included in the offering would have one vote per share.

o Class B common stock shares will be entitled to 10 votes per share, according to the filing. Class B shares will be owned by Liberty Mutual Holding Company Inc., whose status as a mutual holding company will be unaffected by the offering.

LMHC is the parent company of Liberty Mutual Group, which will own about 80 percent of LMAC, with shareholders owning up to 20 percent.

Proceeds from the offering will be used to pay down debt, LMAC said in its filing. The estimated $1.17 billion raised by the offering is based on $19 per share.

About $268 million will be retained by LMAC for working capital, payments of dividends, debt service and other general purposes, the filing said.

Based on direct written premiums, Liberty Mutual Group is the fifth-largest p&c insurer in the United States, bolstered by the recent acquisitions of Safeco Corp. in 2008 and Ohio Casualty in 2007.

From 2005-2009, Liberty Mutual Group did not record a combined ratio under 100, according to figures from Highline Data (www.highlinedata.com), part of Summit Business Media, which publishes National Underwriter. The combined ratio was about 103.3 at the end of 2009.

During the same span Liberty Mutual Group recorded losses in underwriting income, with a loss of nearly $659 million in 2009, according to Highline Data.

Net income for the group in 2009 was about $915.9 million, compared with about $2.4 billion in 2008.

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IPO Set For Liberty Mutual&#039;s Agency Unit, With Goal Of $1.2B

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