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Exhibit (a)(1)(G)
To: BUSINESS WIRE AMY LYNCH
Fax #: 312-573-0019 Ph. #: 888-292-4446
PRESS RELEASE (#1) August 30, 2000
Contact: Mr. Gregory M. Shepard
Chairman and President
American Union Insurance Company
Phone: (309) 827-5968
AMERICAN UNION INSURANCE COMPANY WILL COMMENCE CASH TENDER OFFER FOR ALL THE
COMMON STOCK OF MERIDIAN INSURANCE GROUP, INC., $20 PER SHARE PRICE REPRESENTS
57 % PREMIUM
Bloomington, Illinois-August 30, 2000-Gregory M. Shepard, Chairman and President
of American Union Insurance Company today announced a cash tender offer for all
the common stock of Meridian Insurance Group, Inc. of Indianapolis, Indiana
(NASDAQ: "MIGI"). American Union's offer will commence tomorrow, Thursday. The
price of $20 per share, net to the seller in cash, represents a premium of 57
percent above Tuesday's closing price of $12.75 on the NASDAQ.
Shepard said, "Meridian and American Union make a good fit-positive for the
policyholders, employees, management and agents of both companies. American
Union with only 6 employees located in Bloomington, Illinois can easily meld its
property and casualty operations with Meridian's in Indianapolis. We recognize
Meridian's operating record.
Shepard said he would pledge to maintain the aggregate employment of the current
Meridian operations and planned to add more jobs in the Indianapolis area over
the next few years.
The offering documents disclose that there have been contacts between
representatives of American Union and Meridian relative to a possible business
combination dating back to April of this year. In a letter to Meridian Chairman
Ramon L. Humke and Meridian CEO Norma J. Oman, alerting them to the upcoming
offer, Shepard said those efforts aimed at negotiation had been "consistently
frustrated." " The compelling business logic" of the transaction moved American
Union to act, said Shepard.
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Shepard also said: "for your management and employees, there will be the
opportunity to reap the financial rewards of their contribution to Meridian's
success by tendering their shares. In addition, it is our intention to create an
Employee Stock Ownership Plan, after the closing of the merger, that will own up
to 10% of the Company's outstanding shares."
Meridian Insurance Group's quarterly report for the first six months of 2000
indicated that as of June 30, 2000 there were 7,852,411 outstanding common
shares. Up to 1,285,425 common shares are issuable under various incentive
plans.
The offer is conditioned upon, among other things, (1) there being validly
tendered and not properly withdrawn prior to the expiration of the offer a
number of common shares which, together with the 1,588,400 common shares [20.23%
of the June 30, 2000 outstanding] owned by Shepard, constitute at least 50.1% of
the voting securities of Meridian Insurance Group, Inc. outstanding or issuable
under the company's stock option plans, (2) Meridian's redemption of its
preferred share purchase rights, (3) American Union being satisfied, in its sole
discretion, that the provisions of the Indiana Business Combination chapter are
inapplicable to the Offer and the Proposed Merger, (4) American Union being
satisfied, in its sole discretion, that the provisions of the Indiana Control
Share Acquisitions chapter are inapplicable to the proposed merger described
herein, (5) American Union having obtained all insurance regulatory approvals
necessary for their acquisition of control of Meridian and its insurance
subsidiaries and affiliates on terms and conditions satisfactory to American
Union, in its sole discretion, and (6) American Union obtaining financing.
The offer and its withdrawal rights will expire at 5:00 P.M., New York City
time, on September 29, 2000, unless the offer is extended. The offer is being
made through a wholly owned subsidiary of American Union.
The Depositary and Information Agent for the offer is ChaseMellon Shareholder
Services, L.L.C., 44 Wall Street, 7th Floor, New York, New York, 10005, Call
Toll-Free (888) 451-6741.
American Union Insurance Company is a Bloomington, Illinois based property and
casualty insurance company originally chartered in 1916 by L.F. Shepard as Union
Automobile Insurance Association. The present name was adopted in 1998. Today
50% of American Union's common stock is owned by Gregory M. Shepard and 50% by
Tracy M. Shepard, who are brothers.
WE URGE INVESTORS TO CAREFULLY READ THE TENDER OFFER MATERIALS BECAUSE THE
CONTAIN IMPORTANT INFORMATION. Investors may obtain a free copy of the tender
offer at the Securities and Exchange Commission's web site at www.sec.gov. The
tender offer materials may also be obtained for free from American Union
Insurance Company by direction a written request to American Union Insurance
Company, 303 East Washington Street, Bloomington, Illinois 61701, Attention:
Gregory M. Shepard.
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To: BUSINESS WIRE AMY LYNCH
Fax #: 312-573-0019 Ph. #: 888-292-4446
PRESS RELEASE (#2) August 30, 2000
Contact: Gregory M. Shepard
Chairman and President
American Union Insurance Company
Phone: (309) 827-5958
AMERICAN UNION INSURANCE COMPANY FILES LAWSUIT AGAINST MERIDIAN INSURANCE GROUP
DIRECTORS
Bloomington, Illinois-August 30, 2000-As part of its tender offer for
Indianapolis, Indiana, insurer Meridian Insurance Group, Inc. (NASDAQ: MIGI),
American Union Insurance Company filed a complaint against Meridian Insurance
Group and its directors in the United States District Court for the Southern
District of Indiana alleging the defendants' wrongful conduct in connection with
Meridian's 1997 vote to "opt in" to the Indiana take-over statutes, and for
other breaches of fiduciary duty. The named directors are Ramon L. Humke,
Chairman of the Board of MIGI, Chairman of the Board of Meridian Mutual
Insurance Company "Meridian Mutual" and President and Chief Operating Officer of
Indianapolis Power & Light Company; Norma J. Oman, President and Chief
Executive Officer of MIGI and Meridian Mutual, also a director of Meridian
Mutual; Joseph D. Barnette, Jr., President and Chief Executive Officer of Bank
One, Indiana, N.A.; John T. Hackett, Managing General Partner, CID Equity
Partners, L.P. and also a Director of Meridian Mutual; David M. Kirr, President
of Kirr, Marbach & Company; James D. Price, First Vice President-Investments,
Prudential Securities Incorporated and a Director of Meridian Mutual; Sarah W.
Rowland, Chairman of Rowland Design, Inc. and a Director of Meridian Mutual; and
Thomas H. Sams, President and Chief Executive Officer of Waldemar Industries,
Inc.
The complaint filed alleges that Meridian and its directors have represented to
the Indiana Secretary of State that, in 1997, Meridian Insurance Group, by way
of a majority vote of its shareholders, reversed Meridian Insurance Group's
prior election out of the coverage of various Indiana anti-takeover statutes.
The complaint contends that, in fact, no such vote of Meridian Insurance Group's
shareholders actually occurred or, in the alternative, were it to be determined
that such a vote did occur, then the vote was the direct result of incomplete
and misleading proxy materials provided by Meridian Insurance Group and its
directors to the shareholders of Meridian Insurance Group.
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The complaint further alleges that Meridian's directors a substantial number of
which are directors of Meridian Mutual have violated their fiduciary duties, and
have promoted their own self-interest and entrenchment at the expense of the
shareholders of Meridian, and to the detriment of American Union, by way of
their response and opposition to American Union and the tender offer.
