23 March 2017Insurance

Allied World approves $4.9bn Fairfax deal and share offer

Switzerland-based Allied World Assurance Company's shareholders have approved the merger transaction with Canada-based property/casualty re/insurer Fairfax Financial Holdings.

Fairfax recently increases the cash component of its $4.9 billion offer to $28.00 per share, including $5.00 in special dividend to be paid to Allied World as part of the transaction. The definitive merger agreement was first announced on December 2016.

The proposals approved by Allied World’s shareholders' include "amending the company’s articles of association to remove the limitation on the voting rights of a holder of 10 percent or more of the company’s ordinary shares; and the payment, as soon as possible after the closing of an exchange offer by a subsidiary of Fairfax to acquire all of the company’s outstanding ordinary shares, a special dividend of $5.00 per ordinary share to holders of the company’s outstanding ordinary shares as of immediately prior to the closing of the exchange offer and forgoing the $0.26 quarterly dividend," it said in a statement.

Scott Carmilani, Allied World’s president and chief executive officer, said: "We are pleased with the overwhelming support we received today from our shareholders. With today’s vote, we move one step closer to completing the transaction with Fairfax, to the benefit of our shareholders, customers, business partners and employees."

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More on this story

16 May 2017   Premium rates are set to further decline in reinsurance throughout 2017 due to overcapacity and sluggish demand, according to Fitch Ratings.
6 July 2017   Canada-based Fairfax Financial Holdings said July 6 that it closed the acquisition of Switzerland-based Allied World Assurance Company Holdings.
11 July 2017   S&P Global Ratings has lowered the ratings on Switzerland-based Allied World which has been acquired by Canada-based Fairfax.