Liberty Mutual will buy firm for $2.7 billion

Liberty Mutual Group said today it has agreed to acquire Ohio Casualty Corp. for $44 a share, or $2.7 billion.

Boston-based Liberty Mutual is a large property and casual insurer; according to Liberty Mutual, the combined entity will become the largest regional provider of property and casualty products distributed through independent agents in the United States.

Liberty Mutual's proposed sale price for the Ohio insurance company represents a 32 percent premium over Ohio Casualty's Friday closing price of $33.32 a share.

The proposed transaction, which has been approved by the board of directors at both companies, is subject to the approval of Ohio Casualty shareholders and customary regulatory approvals and conditions, Liberty Mutual said.

Following the acquisition, Ohio Casualty will be part of Liberty Mutual Group's Agency Markets business unit, Liberty Mutual said.

"Through the addition of Ohio Casualty, our regional-company independent agency business is significantly stronger, and our agency relationships are strengthened," Edmund F. Kelly, Liberty Mutual Group chairman, president, and chief executive, said in a statement.

In mid day trading on the Nasdaq Stock Market, shares of Ohio Casualty had risen $9.83 to $43.15.
(By Chris Reidy, Globe staff)