Unico Insurance Reviews Strategic Alternatives

The board of Unico American Corp. has authorized a review of strategic alternatives for the company aimed at enhancing shareholder value.The Calabasas insurance holding company said in a release that it had retained TigerRisk Capital Markets & Advisory in Stamford, Conn. as its exclusive financial advisor.The company does not intend to make further statements regarding the review process until a definitive agreement has been reached or until the process has ended, it said in its release.Unico American underwrites property and casualty insurance through its insurance company subsidiary Crusader Insurance Co. and transacts health insurance, insurance premium financing and membership association services through its other subsidiaries.In a release last month to report second quarter financial information, Unico expressed doubts about its ability to continue as a business.Unico, as a holding company, is dependent on dividends from Crusader and its other subsidiaries to fund its operations and expenses. Unico does not expect to receive dividends from Crusader to fund its operations and expenses for the foreseeable future due to Crusader’s decreased policyholder surplus caused by additional underwriting losses during 2021, the company said in the August release.“Unico needs to improve its operating results and/or raise substantial additional capital to continue to fund its operations, and to successfully execute its current operating plan,” the company added in its release. “To meet its capital obligations, Unico is considering multiple alternatives, including, but not limited to, strategic financing, reevaluation of its planned operations, delaying, scaling back, or eliminating some or all of its business operations, expense reduction, reorganization, merger with another entity or cessation of operations.”Shares of Unico (UNAM) closed down by 14 cents, or 4 percent, to $3.34 on the Nasdaq, on a day when that market closed up a fraction of a percent.