Investors reveal $2.7bn AmTrust deal to take it private
Stone Point Capital, the Karfunkel Family, and the CEO of AmTrust Financial Services are acquiring the insurer in a transaction valued at approximately $2.7 billion.
Specialty property/casualty insurer AmTrust has entered into a definitive agreement with Evergreen Parent, an entity formed by private equity funds managed by Stone Point Capital, together with AmTrust CEO Barry Zyskind, George Karfunkel and Leah Karfunkel, in which Evergreen Parent will acquire 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.
Under the terms of the proposed merger, AmTrust common shareholders who are not affiliated with the Karfunkel-Zyskind Family will receive $13.50 in cash for each share of AmTrust common stock they hold. This represents a premium of 33 percent to the company's closing common stock price on Jan. 9, 2018, the last trading day before Stone Point and the Karfunkel-Zyskind Family announced their proposal to acquire all of the outstanding common shares of AmTrust that the Karfunkel-Zyskind family did not already own or control.
The Karfunkel-Zyskind family and certain of its affiliates and related parties will rollover their shares in the company for interests in Evergreen Parent. Each share of the company's currently outstanding preferred stock will remain outstanding and it is expected that they will continue to be listed on the New York Stock Exchange following the consummation of the transaction.
The proposed merger is anticipated to close in the second half of 2018. AmTrust's board of directors has unanimously approved the proposed merger.
"I believe that this transaction represents an exciting step forward for AmTrust, our employees, and the agents, brokers, partners, and customers we serve,” said Zyskind. “As a private enterprise, we will be able to focus on long-term decisions, without the emphasis on short-term results."
"The year 2018 marks the 20th anniversary of AmTrust's founding,” Zyskind continued.
“Alongside Stone Point Capital, a strong partner widely recognized as an experienced investor in the insurance sector, the Karfunkel-Zyskind family is deeply committed to the long-term strength and success of AmTrust. We are well-positioned to continue meeting our policyholders' needs, supporting our brokers and agents, and developing our partner relationships."
Jim Carey, senior principal of Stone Point Capital, said: "AmTrust has built its business through an innovative spirit and dedication to their employees, customers and partners. Under Barry Zyskind's leadership, AmTrust will continue to invest in long-term growth initiatives and continue to support their policyholders, agents and brokers."
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