Midland Company, the Cincinnati-based specialty insurer, announced that shareholders at a special meeting today approved the company's acquisition by Munich Re in a deal worth $1.27 billion.
Under terms of the agreement, Munich will acquire the company through its subsidiary, Munich-American Holding Corp., and Midland shareholders will receive $65 per share.
The transaction is expected to close on or about April 3, after certain remaining conditions are satisfied, Midland said.
John W. Hayden, Midland president and chief executive officer, said the new relationship with Munich Re represents a great opportunity for Midland.
"Munich Re Group is a formidable player in the global insurance and reinsurance marketplace. They understand the creative aspects of our business and are fully committed, and uniquely equipped to facilitate our continued growth," said Mr. Hayden.
He said shareholders "overwhelming support" for the merger "is a resounding affirmation of the synergies we expect to realize as a critical part of Munich Re's plans for profitable growth in the United States."
Munich Re America CEO Tony Kuczinski said he looks forward to working with a company "with a portfolio of strong products and relationships and a very focused mindset on underwriting profitability."
Midland said the shareholder vote is subject to the customary review and challenge period and final results may be released after the votes have been tabulated and certified, which the company expects to occur within five-to-10 business days.
Midland stockholders may expect payment seven days after the merger closes, which is expected to occur on or about April 3, the company said. Holders of certificated shares of Midland common stock will receive a letter of transmittal and other materials from Midland's paying agent. These materials will have to be completed and returned to the paying agent, said Midland.
Munich Re Group operates in all lines of business, with around 37,000 employees at over 50 locations throughout the world. Munich Re America, through its subsidiaries, writes treaty and facultative reinsurance, insurance.
Midland, through its wholly owned subsidiary, American Modern Insurance Group, provides products which account for approximately 95 percent of Midland's consolidated revenue. American Modern specializes in writing physical damage insurance and related coverages on manufactured housing and has expanded to other specialty insurance products including coverage for site-built homes, motorcycles, watercraft, snowmobiles, recreational vehicles, physical damage on long-haul trucks, extended service contracts, and excess and surplus lines coverages.
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