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Exhibit 99.3
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PRESS RELEASE
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MAPFRE
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MAPFRE REACHES AN
AGREEMENT TO ACQUIRE US INSURER
COMMERCE FOR Euros 1,538 MILLION ($2,207
MILLION)
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IT WILL BE A DECISIVE
STEP IN MAPFRE'S INTERNATIONAL STRATEGY AND
THE LARGEST INVESTMENT IN THE HISTORY OF THE
GROUP
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MAPFRE and US insurer
COMMERCE have announced today the signing of a merger agreement by
which MAPFRE will acquire 100 per cent of the share capital of US
insurer COMMERCE for Euros 1,538 million ($2,207 million), in what
represents a decisive step in its international expansion and the
largest investment in the history of the Group.
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The agreement foresees the
merger of COMMERCE with a US subsidiary of MAPFRE. Once carried
out, the shareholders of COMMERCE will receive $36.70 per share,
representing a 22.5% premium over the average share price of the
last 30 days.
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COMMERCE is the leading
writer of Non-life personal insurance lines in the state of
Massachusetts (US), where it holds a 31.5% market share in personal
Motor Insurance. The US insurer is currently involved in an
expansion plan outside its state of origin for which it holds
licences in all 50 states of the Union and operates in 17 of
them.
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MAPFRE will pay the
consideration entirely in cash, which it plans to finance through
an equity capital raising of Euros 500 million ($718 million), the
issuance of bonds up to Euros 800 million ( $ 1,148 million), with the
balance coming from internal resources. The acquisition is expected
to have a positive financial return for MAPFRE's shareholders from
the beginning, raising earnings per share. The transaction is
subject to the relevant regulatory authorisations and to the
requisite approval of the merger agreement by the holders of at
least two-thirds of the shares of COMMERCE common stock.
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The acquisition underscores
MAPFRE's commitment to enter the US market. COMMERCE has a total of
1,586 independent and specialised agents and 1,152 brokers and
recorded gross written and accepted premiums of Euros 1,368 million
($1,963 million) and net earnings of Euros 168 million ($241.5
million) in 2006, with
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