Everest Re Group, Ltd. plans to sell its U.S. crop insurance subsidiary, but still keep a hand in the business through reinsurance.

The deal, announced July 25, calls for CGB Diversified Services Inc. to buy Heartland Crop Insurance from Everest Re for an undisclosed price. Once the sale is complete, Everest will provide quota share reinsurance capacity on the combined crop insurance portfolio of Diversified/Heartland, according to the announcement.

Specifically, the sale agreement is outlined in a letter of intent. The sale will close pending various regulatory and board approvals, and the finalization of the stock purchase agreement. Neither side is disclosing financial terms.

John Doucette, president and CEO of the Everest reinsurance operation, noted in prepared remarks that the deal gives his company access “to a much broader, more diversified crop insurance portfolio.”

According to the deal announcement, CGB DS is among the fastest growing crop insurance companies in the U.S., with crop insurance products and services available to farmers in 38 states.

Ron Miller, president of CGB DS, said in a prepared statement that the acquisition “will make us a significant force in our industry in the years ahead.”

Miller added that the company looks forward to welcoming Heartland employees, agents and customers to the team.

The U.S. crop insurance sector has seen plenty of changes in recent months, with companies including Cargill, Wells Fargo, Monsanto and tractor maker Deere & Co. exiting the business, selling off their piece of it to other players. The reason: uncertainty about federal aid and lower agricultural prices crimping revenue.

Source: Everest Re, CGB DS