Liberty Mutual Holding Company Inc. (LMHC) signed a definitive agreement to acquire 41.2% stake in State Auto Financial Corporation (NasdaqGS:STFC) for $1.1 billion on July 12, 2021. Under the terms of the agreement, State Auto mutual members will become mutual members of Liberty Mutual and Liberty Mutual will acquire all of the publicly held shares of common stock of State Auto Financial for $52 per share in cash. Upon termination of the Merger Agreement, under specified circumstances, STFC may be required to pay a termination fee to LMHC in an aggregate amount of $70,793,307. The deal is pending State Auto Mutual member approval, State Auto Financial shareholder approval, receipt of required regulatory approvals and other customary closing conditions. In connection with the merger of State Auto Financial, State Auto Mutual has entered into a voting agreement with Liberty Mutual under which it has agreed to vote in favor of the merger. The transaction was approved by the State Auto Financial board of directors (upon the recommendation of a special committee of independent State Auto Financial directors), as well as the State Auto Mutual board of directors (upon the recommendation of a special committee of independent State Auto Mutual directors). Merger is expected to close in 2022. Waller Helms Advisors LLC and Goldman Sachs & Co. LLC acted as financial advisors and fairness opinion providers and Todd E. Freed, Jessica A Hough, Patrick J Lewis, Joseph M Penko and Elena M. Coyle of Skadden, Arps, Slate, Meagher & Flom LLP acted as legal advisors to Liberty Mutual in the transaction. Houlihan Lokey Capital, Inc. acted as financial advisor and fairness opinion provider and Edward Lee, Rajab Abbassi, Parimah Hassouri and Stephen Jacobson of Kirkland & Ellis LLP acted as legal advisors to the Special Committee of Independent Directors of State Auto Financial in the transaction. Keefe, Bruyette & Woods, a Stifel Company, and BofA Securities, Inc. acted as financial advisors and Matthew S. Bailey and Jeffrey R. Wahl of Squire Patton Boggs (US) LLP acted as legal advisor to the Special Committee of Independent Directors of State Auto Mutual in the transaction. Aaron Dixon of Alston Bird LLP acted as counsel to Houlihan Lokey in the transaction.