AmTrust shareholders approve go-private deal

AmTrust Financial Services stockholders have, at a  special meeting held today, June 21, 2018, approved the proposed  amended merger transaction which will take the insurer specialized in the coverage for small businesses private.

The deal will see Evergreen Parent, an entity formed by private equity funds managed by Stone Point Capital, together with Barry Zyskind, chairman and CEO of AmTrust, George Karfunkel and Leah Karfunkel, acquiring the approximately 45 percent of the company's issued and outstanding common shares that the Karfunkel-Zyskind Family and certain of its affiliates and related parties do not presently own or control.

AmTrust stockholders will receive $14.75 in cash for each share of AmTrust common stock they own. The transaction values the fully diluted equity of the company at approximately $2.95 billion, excluding the company's outstanding preferred stock. The transaction is expected to close during the second half of 2018, subject to the satisfaction of customary closing conditions, including approval by regulatory authorities.

The final vote showed that 79.8 percent of the outstanding common stock, representing 92.6 percent of the shares voted, were cast in favour of the merger.

With respect to the public stockholders, 67.4 percent of the total public stock outstanding, representing 81.5 percent of the public shares voted at the special meeting, were cast in favour of the merger.

"We are pleased with the outcome of today's vote,” Zyskind said. “In addition to maximizing value for our public stockholders, this transaction provides AmTrust with a strong partner in Stone Point. Together, as a private company, we will continue to serve our clients, agents, partners and policyholders with a focus on initiatives that will help them achieve success."

Jim Carey, senior principal of Stone Point Capital, said: "We look forward to working closely with management to help them drive their current operational initiatives and ultimately capitalize on the longer-term opportunities for the business."

AmTrust reported a net loss of $348.9 million for  2017 after a net profit of $430.4 million in 2016. Zyskind had previously argued that as a private enterprise AmTrust will be able to focus on long-term decisions, without the emphasis on short-term results. AmTrust wants to address financial controls as well as pricing and reserve adequacy issues.

Make sure you are GDPR compliant and  confirm your email address to keep getting our daily emails

More of today's news

XL Catlin launches specialty aviation insurance in Mexico

PCI in negotiations to merge with AIA

Munich Re in talks over asset management unit sale

Allstate cat losses at $278m in May

Insurtech Oscar expands in the US

Don't miss our insurtech email newsletter - sign up today