Toronto-based Fairfax Financial Holdings Limited said it will make a formal offer of $686 million Canadian ($556.5 million U.S. dollars at current exchange rate), or $39 Canadian per common share, to acquire the remaining outstanding common shares of commercial insurer Northbridge Financial Corp.
Fairfax, a financial services holding company, currently owns 63.1 percent of Toronto-headquartered Northbridge's outstanding common shares. The firm said the price of $39 Canadian per Northbridge common share "represents a premium of approximately 28.9 percent over the Nov. 13 $30.25 Canadian closing price of Northbridge common shares on the Toronto Stock Exchange," which was the day Fairfax approached Northbridge's board of directors to consider the proposed transaction.
Should the transaction go through, Fairfax said it is expected that Northbridge, Canada's largest commercial property-casualty insurance group, would become a wholly-owned subsidiary of Fairfax.
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