BATUS MAKES HOSTILE BID FOR FARMERS

BATUS MAKES HOSTILE BID FOR FARMERS

BATUS Inc. Thursday launched a $4.5 billion hostile tender offer for Farmers Group Inc., one of the nation's largest home and automobile insurers.

BATUS Chairman Patrick Sheehy said the Louisville company decided to take its $63-per-share proposal directly to Farmers shareholders because its board has regrettably refused to talk to us so far.Los Angeles-based Farmers, which had no immediate comment on the offer, had rejected BATUS' proposed $60-a-share, or $4.2 billion, bid on Jan. 20.

In a statement, Mr. Sheehy said the tender offer represents a premium of 47 percent over the $43 price at which Farmers shares closed on the day before our initial proposal.

BATUS is a subsidiary of British-based BAT Industries PLC, a tobacco, retailing and insurance conglomerate.

BATUS said the latest offer is conditioned upon BATUS obtaining at least 51 percent of Farmers' 69 million outstanding shares and on required state insurance regulatory approval. The offer is set to expire March 30.

Mr. Sheehy said BATUS was firmly convinced that the interests of Farmers and its employees and policyholders would be best served by Farmers becoming a part of the BATUS group.