White Mountains Selling Two Subsidiaries
Bermuda-domiciled financial services holding company White Mountains Insurance Group, today [May 18] announced it has signed a definitive agreement to sell its Esurance and Answer Financial businesses to The Allstate Corporation for an amount in cash equal to $700 million plus the tangible book value at closing of the entities being sold.
Esurance sells personal auto insurance directly to customers online and through call centers. Answer Financial is one of the largest independent personal insurance agencies in the United States. White Mountains expects that the transaction will increase its adjusted book value by approximately $80 per share.
White Mountains Chairman and CEO Raymond Barrette said, “Over the past ten years, Gary Tolman and his team have done a phenomenal job building a startup into one of the top online insurers in the United States. We have happily invested significant capital in what we believed was a unique business. Allstate agrees and can now take it to a new level.
“This is a win-win transaction. We thank Gary and team for a great ride and we wish them continued success as they transition to Allstate.”
The transaction is expected to close in the fall of 2011. It is subject to regulatory approval, continued availability of select senior management, and other customary closing conditions.
