2023 New Mexico Statutes › Chapter 59A - Insurance Code › Article 37 - Insurance Holding Companies › Section 59A-37-4 - Acquisition of control of or merger with domestic insurer.

A. No person other than the issuer shall make a tender offer for or a request or invitation for tenders of, or enter into an agreement to exchange securities for, acquire, seek to acquire, in the open market or otherwise, a voting security of a domestic insurer if, after the consummation of it, the person would, directly or indirectly or by conversion or by exercise of any right to acquire, be in control of the insurer, and no person shall enter into an agreement to merge with or otherwise to acquire control of a domestic insurer unless, at the time any such offer, request or invitation is made or an agreement is entered into, or prior to the acquisition of the securities if no offer or agreement is involved, the person has filed with the superintendent and has sent to the insurer, and the insurer has sent to its shareholders, a statement containing the information required by Section 59A-37-5 NMSA 1978 and the offer, request, invitation, agreement or acquisition has been approved by the superintendent in the manner hereinafter prescribed.
B. For the purposes of Sections 59A-37-4 through 59A-37-10 NMSA 1978, the superintendent shall identify the circumstances in which a person seeking to divest or acquire an interest of control of a domestic insurer is required to obtain the superintendent's approval for the transaction. A person who controls a domestic insurer and seeks to divest its interest of control of the domestic insurer shall, at least thirty days prior to the cessation of control, file with the superintendent confidential notice of the proposed divestiture and give a copy of that notice to the insurer. Information contained in the notice shall remain confidential until the conclusion of the transaction if the superintendent has not determined that treating the information as confidential will interfere with the provisions of this section. This subsection does not apply to a statement filed pursuant to Subsection A of this section.
C. For a transaction subject to Sections 59A-37-4 through 59A-37-10 NMSA 1978, the acquiring person shall file with the superintendent a pre-acquisition notice, which shall contain the information set forth in Paragraph (1) of Subsection C of 59A-37-29 NMSA 1978. The superintendent may subject a person who fails to file the notice required by this subsection to a fine of not more than fifty thousand dollars ($50,000).
D. For the purposes of this section and Sections 59A-37-5 through 59A-37-10 NMSA 1978:
(1) "domestic insurer" includes any other person controlling a domestic insurer unless the other person, as determined by the superintendent, is either directly or through its affiliates primarily engaged in business other than the business of insurance; and
(2) "person" shall not include any securities broker holding, while in the performance of the broker's usual and customary broker's function, less than twenty percent of the voting securities of an insurer, or of any person that controls an insurer.
History:
Laws 1984, ch. 127, § 619; 1993, ch. 320, § 73; 2014, ch. 59, § 31.
ANNOTATIONS
The 2014 amendment,
effective July 1, 2014, expanded regulatory requirements involved in the sale or divestiture of a controlling interest in a domestic insurer; provided for the filing of a notice of proposed divestiture and a pre-acquisition notice; provided a penalty; in the catchline, after "control of", added "or merger with"; added Subsections B and C; and in Subsection D, Paragraph (1), after "unless the other person", added "as determined by the superintendent".
Severability.
— Laws 2014, ch. 59, § 54 provided that if any part or application of the provisions of Laws 2014, ch. 59 is held invalid, the remainder or its application to other situations or persons shall not be affected.
The 1993 amendment,
effective June 18, 1993, in Subsection A inserted "merge with or otherwise to" preceding "acquire control of a domestic insurer" near the middle of the subsection and substituted "Section 59A-37-5 NMSA 1978" for "Section 620 of this article"; designated the former second sentence of Subsection A as Subsection B; in present Subsection B, added the paragraph "(1)" designation, substituted "person" for "business entity" in Paragraph (1), added "and", and added Paragraph (2); and deleted former Subsection B, which read: "This section does not apply as to merger, consolidation or bulk reinsurance of an insurer."
Am. Jur. 2d, A.L.R. and C.J.S. references. —
44 C.J.S. Insurance § 131.