Fairfax Financial Announce American Safety Deal
Fairfax Financial Holdings Ltd., a Canadian insurer, this week [June 3] agreed to buy Bermuda-based American Safety Insurance Holdings Ltd. for $306 million in an all-cash deal that will bring $480 million of investable assets.
American Safety shareholders will receive $29.25 per share, a 22 percent premium to the Bermuda insurer’s May 31 closing price, Toronto-based Fairfax said in a statement.
Fairfax plans to sell American Safety’s reinsurance unit to Bermuda holding company Tower Group International Ltd. [TWGP] for an undisclosed price once the deal is completed, the firm said.
“We expect to enhance our insurance operations in certain specialty lines of business with American Safety’s expertise,” Prem Watsa, Fairfax’s chief executive officer, said in the release.
The acquisition will be financed using internal resources and won’t require cash from the holding company, Fairfax said.
The deal is expected to be completed in the fourth quarter.
