James River To Be Acquired For $575M

Richmond, Va.-based insurer James River Group Inc. said it has signed an agreement to be acquired by D. E. Shaw group, a Bermuda-based private equity firm, in a transaction valued at approximately $575 million.

In a statement, James River said stockholders would receive $34.50 in cash per share for the purchase. The company is listed on the NASDAQ Exchange.

The company said it expects the transaction to be completed in the second half of 2007, subject to stockholder and regulatory approvals and other closing conditions.

Under the terms of the merger agreement, James River and a committee of the board of directors will solicit superior bids from third parties during the next 55 calendar days until Aug. 5.

If there is a superior bid, D. E. Shaw group will receive a termination fee of approximately $7.2 million. The company may also respond to unsolicited bids during that period.

"We are pleased with the prospect of having such a well-capitalized and committed partner as we go forward," said J. Adam Abram, president and chief executive officer of James River.

He said after the transaction closes, the company expects a new Bermuda-based reinsurance company will be added to its group.

James River Group is an insurance holding company that owns and manages specialty property-casualty insurance companies: James River Insurance Company, an excess and surplus lines carrier, and Stonewood Insurance Company, a workers' compensation carrier.

The D. E. Shaw Group is a global investment and technology development firm with more than 1,100 employees and approximately $30 billion in aggregate investment capital.