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After nearly a decade of planning, Economical Mutual Insurance Co. is on track to announce a $1.9-billion initial public offering in late 2021.

Economical announced this week that it will hold a meeting of its 630,000 eligible policyholders in the second quarter of 2021 to vote on the final phase of a proposal to go public in a process known as demutualization.

A mutual insurance company is owned by its participating policyholders, whose stake is typically converted into share ownership when the company demutualizes.

The Waterloo, Ont.-based insurer is Canada’s eighth-largest property and casualty insurer, with a 4-per-cent market share, according to data compiled by the Insurance Bureau of Canada. In recent years, the P&C industry has undergone a wave of consolidation, particularly with foreign-owned insurers selling their Canadian operations to domestic companies.

Last month, Intact Financial Corp. and another buyer announced a joint takeover of Britain’s RSA Insurance Group PLC, including its Canadian operations. In Canada, RSA has a roughly 5-per-cent market share and the acquisition will help boost Intact’s footprint in the P&C sector.

Economical chief executive Rowan Saunders said the move to a public company will allow Economical to become a larger player against multinational companies and participate in the consolidation that has been occurring over the past decade.

“The timing [to launch an IPO in 2021] is great because we think there will be ongoing consolidation in the Canadian marketplace and one of the challenges we have had as a mutual company is that we haven’t had access to external capital,” Mr. Saunders said in an interview. “Now, as a public company we will be able to be a meaningful participant in a consolidating industry.”

The exact date of the vote has not yet been set for the 148-year old insurer, which needs to get authorization from the Office of the Superintendent of Financial Institutions. But after nine “rigorous” years of planning to demutualize, Mr. Saunders said the company has spent the past several years improving the company’s financial performance and is now ready to complete the final step in the process with next year’s vote.

In 2018 and 2019, the company spent months negotiating between two groups of policyholders, and announced in early 2019 it would split the pot, with mutual policyholders each receiving between $300,000 and $430,000 in shares or cash for their stakes in the company. A second group of approximately 630,000 non-mutual policyholders, who are not legal owners of the firm but did contribute to building its value, will each get $1,500 to $2,300.

Those valuations could change depending on when the company decides to plan its IPO.

After the final vote, the company will submit a formal application to demutualize to the federal minister of finance, a step that is required within three months of the special meeting. In a letter to policyholders, chairman John Bowen said if approvals are completed on a timely basis and capital market conditions are favourable, the company would anticipate to launch the IPO the fall of 2021.

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