State Auto selling software biz to Columbus company - Business First of Columbus:
State Auto Financial Corp. is selling the business management software it created nearly 15 years ago to another company in Columbus.
The insurer this week said it will sell its Strategic Insurance Software business to NuGrowth Solutions, a 20-employee software sales and business development operation. Terms of the deal weren’t disclosed, but State Auto spokesman Win Logan said the sale won’t be material to the company’s financial results.
The sale is expected to close Aug. 31.
Shedding Strategic Insurance marks the end of what was a major step for State Auto when it created the business.
“We’re not a software company, and when we did this years ago, for us it was a new venture,” Logan said.
The software, whose clients are mostly State Auto agencies, allows users to track and manage clients, insurance products and business transactions. The operation is run out of an office on Morrison Road in Gahanna and has 16 employees.
The deal came out of a move State Auto made last year in hiring NuGrowth to market the software, a practice that had been challenging for the insurer, Logan said.
“The business was fine. The product was fine. It’s the marketing of it,” he said. “That’s something NuGrowth does well, so we struck a deal.”
State Auto CEO Bob Restrepo said the transaction allows the insurer to focus on its business.
“State Auto is an insurance company and that needs to be our singular focus,” he said in a release.
The deal to acquire Strategic Insurance represents the first acquisition of its kind for NuGrowth, spokeswoman Carol Williams said. Strategic Insurance’s employees will remain at the Gahanna office until a lease expires this year and they will be moved to NuGrowth’s headquarters at Arlingate Plaza.
NuGrowth declined to comment further on the acquisition until the deal closes.
State Auto Financial (NASDAQ:STFC) has about 2,200 employees and in 2008 lost $31 million on $1.2 billion in revenue. State Automobile Mutual Insurance Co. owns about two-thirds of its stock.