Oct 12 Nationwide Mutual Insurance Co
said it will pay $26 million to settle a class action and
derivative lawsuit related to its $760 million acquisition of
The litigation brought on behalf of former Harleysville
Mutual policyholders claimed that Harleysville's directors
enriched themselves as part of the merger. Policyholders did not
receive a payment from the deal, it was alleged, while
shareholders got a 90 percent premium.
"Given the potential cost and burden of continued
litigation, Nationwide believes that settling this lawsuit is in
the best interest of all Nationwide and Harleysville
stakeholders," Nationwide said in a statement.
The settlement, which needs to be approved by the
Philadelphia Court of Common Pleas, was not an admission of
wrongdoing by either of the companies, Nationwide said.
Nationwide announced the deal in September last year,
expanding its reach in commercial insurance.