SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 14D-1 TENDER OFFER STATEMENT (AMENDMENT NO. 2) PURSUANT TO SECTION 14(D)(1) OF THE SECURITIES EXCHANGE ACT OF 1934 ALLIED GROUP, INC. (NAME OF SUBJECT COMPANY) NATIONWIDE GROUP ACQUISITION CORPORATION NATIONWIDE MUTUAL INSURANCE COMPANY (Bidders) COMMON STOCK, NO PAR VALUE (Title of Class of Securities) 019220102 (CUSIP Number of Class of Securities) W. SIDNEY DRUEN SENIOR VICE PRESIDENT AND GENERAL COUNSEL NATIONWIDE MUTUAL INSURANCE COMPANY ONE NATIONWIDE PLAZA COLUMBUS, OHIO 43215 TELEPHONE: (614) 249-7111 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications on Behalf of Bidders) WITH A COPY TO: ERIC M. FOGEL, ESQ. HAROLD W. NATIONS, ESQ. HOLLEB & COFF 55 E. MONROE STREET, SUITE 4100 CHICAGO, ILLINOIS 60603 TELEPHONE: (312) 807-4600 This Statement amends and supplements the Tender Offer Statement on Schedule 14D-1 (the "Schedule 14D-1") filed with the Securities and Exchange Commission on May 19, 1998 by Nationwide Group Acquisition Corporation, an Ohio corporation and a wholly owned subsidiary of Nationwide Mutual Insurance Company, an Ohio mutual insurance company, to purchase all outstanding shares of common stock, no par value (the "Common Shares"), of Allied Group, Inc., an Iowa corporation, at a price of $47.00 per Common Share, net to the seller in cash, without interest thereon, upon the terms and subject to the conditions set forth in the Offer to Purchase dated May 19, 1998 (the "Offer to Purchase") and in the related Letter of Transmittal. Capitalized terms used and not defined herein shall have the meanings assigned such terms in the Offer to Purchase and the Schedule 14D-1. ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER. Upon successful conclusion of the Offer, Parent intends to terminate the ESOP and distribute the benefits to the ESOP participants. All qualifying employees of the Company will thereafter be eligible to participate in Parent's 401(k) plan. As part of the termination, all participants' accounts will become fully vested and nonforfeitable. Participants can then choose to roll over the distribution to an IRA, roll over the distribution to Parent's 401(k) plan, or otherwise receive it as a taxable distribution. ITEM 11. MATERIAL TO BE FILED AS EXHIBITS. (a)(25) Letter to participants in the Allied Group Employee Stock Ownership Plan. (a)(26) Advertisement entitled "To the Employees of Allied:". SIGNATURE After due inquiry and to the best of its knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. Dated: May 29, 1998 NATIONWIDE MUTUAL INSURANCE COMPANY By: /s/ David A. Diamond ---------------------------------------------------- Name: David A. Diamond Title: Vice President - Enterprise Controller NATIONWIDE GROUP ACQUISITION CORPORATION By: /s/ Mark B. Koogler ---------------------------------------------------- Name: Mark B. Koogler Title: Vice President - Associate General Counsel Exhibit (a)(25) To: Participants in the Allied Group Employee Stock Ownership Plan As many of you know, Nationwide Mutual Insurance Company and its wholly owned subsidiary Nationwide Group Acquisition Corporation have announced a cash tender offer for all of the outstanding common stock of Allied Group, Inc. at a price of $47 per share, net to the seller in cash, without interest thereon. As a participant in the Allied Group Employee Stock Ownership Plan, you have the opportunity to decide whether to tender your shares held for your benefit by the Plan. If the tender offer is successful, you will be allocated $47 for every share in your account. Moreover, based on recent IRS guidance, we estimate that an additional $38 per share should be available for allocation to your account on the next allocation date. This additional allocation is based upon our estimate of the current number of unallocated and allocated shares held by the ESOP and the current ESOP debt. THEREFORE, WHEN COMPARED TO THE CLOSING PRICE ON MAY 15, 1998 (THE MOST RECENT TRADING DAY PRIOR TO THE ANNOUNCEMENT DATE OF THE OFFER) OF ALLIED GROUP, INC. COMMON STOCK OF $27.75, OUR CALCULATIONS SHOW THAT THE STOCK PORTION OF EACH TENDERING PARTICIPANT'S ACCOUNT WILL TRIPLE BASED ON THE OFFER PRICE AND THE ADDITIONAL ALLOCATION DESCRIBED ABOVE. THIS LETTER ACCOMPANIES TENDER OFFER MATERIALS TO HELP YOU MAKE AN INFORMED DECISION. UPON SUCCESSFUL CONCLUSION OF THE TENDER OFFER, NATIONWIDE WILL TERMINATE THE PLAN AND DISTRIBUTE THE BENEFITS TO THE PARTICIPANTS. ALL QUALIFYING ALLIED EMPLOYEES WILL THEREAFTER BE ELIGIBLE TO PARTICIPATE IN NATIONWIDE'S 401(K) PLAN. AS PART OF THE TERMINATION, ALL PARTICIPANTS' ACCOUNTS WILL BECOME FULLY VESTED AND NONFORFEITABLE. PARTICIPANTS CAN THEN CHOOSE TO ROLL OVER THE DISTRIBUTION TO AN IRA, ROLL OVER THE DISTRIBUTION TO NATIONWIDE'S 401(K) PLAN, OR OTHERWISE RECEIVE IT AS A TAXABLE DISTRIBUTION. We believe that your positive response will maximize your account and, therefore, strongly urge you to tender your shares. If you have any questions or would like more information, contact Georgeson & Company Inc., the information agent, at (800) 223-2064. Nationwide reaffirms its commitment to increase the current level of Allied employment, and looks forward to making its benefit programs available to its new employees. Your direction regarding your tender of shares is, by law and under the terms of the Plan, confidential. We encourage you to give your instructions to the Plan Trustee in order to accomplish the tender of your shares. Very truly yours, NATIONWIDE MUTUAL INSURANCE COMPANY NATIONWIDE GROUP ACQUISITION CORPORATION LETTER OF DIRECTION To: State Street Bank and Trust Company Trustee of the Allied Group Employee Stock Ownership Plan 200 Newport Avenue, Room 7S North Quincy, MA 02171 Ladies and Gentlemen: The undersigned participant or beneficiary in the Allied Group Employee Stock Ownership Plan hereby directs you to tender all shares of Allied Group, Inc. attributable to my participation in the Plan to Nationwide Group Acquisition Corporation in response to its Offer to Purchase, dated May 19, 1998. --------------------------------------------------------- Exhibit (a)(26) TO THE EMPLOYEES OF ALLIED: If you're a participant in the ALLIED Employee Stock Ownership Plan (ESOP), the value of your account should triple.* How would this work? First, your account would get the benefit of Nationwide's tender offer for $47 per share. Second, the ESOP debt, currently about $22.4 million would be paid off from the tender offer proceeds received by the unallocated portion of the ESOP. Third, the surplus in the unallocated portion of the ESOP would be distributed among the 2,500 or so participants at the next accounting date for AN AVERAGE TOTAL YIELD OF $163,000 PER PARTICIPANT. Of course, the actual amount allocated to your account would depend on your proportionate share of the ESOP. YOU WOULD NOT HAVE TO WAIT to get the full benefit. Following completion of the tender offer, NATIONWIDE WILL FULLY VEST ALL ESOP PARTICIPANTS. The ESOP would then be terminated and your benefits distributed to you. If you wish to defer taxes on the distribution, you could roll it over to an IRA or Nationwide's 401(k) plan. ALL THIS, PLUS NATIONWIDE'S PUBLIC PLEDGE TO GUARANTEE CURRENT ALLIED EMPLOYMENT LEVELS AND ITS EXPRESSED INTENTION TO ADD 400 NEW JOBS IN DES MOINES ALONE OVER THE NEXT FOUR YEARS. To get these benefits, instruct your ESOP trustee to tender into the Nationwide offer. Remember, by law your instructions are confidential. If you own ALLIED common shares independent of the ESOP, tender these shares directly into the Nationwide offer. NATIONWIDE IS ON YOUR SIDE [LOGO] - -------------------------------------------------------------------------------- Questions? Call GEORGESON & COMPANY INC., at 1-800-223-2064 or visit our website at georgeson.com. - -------------------------------------------------------------------------------- *This benefit is based on our calculation of an estimated $183 million surplus which will be divided among approximately 2,500 participants. Based upon our interpretation of a recent IRS technical advice memorandum, at the next accounting date each participant will receive an earnings allocation of approximately $38 per share, in addition to the $47 tender price per share. After payment of the ESOP debt, the average account balance per participant should approximate $163,000 with the actual amounts credited to a participant's account dependent on their account balance. -----END PR