ProAssurance to Buy Workers Comp Insurer Eastern for $205M

Workers compensation insurer Eastern Insurance Holdings is being purchased by ProAssurance Corp. for about $205 million, the companies said.

Lancaster, Pa.-based Eastern is set to merge into specialty insurer ProAssurance as a newly-formed subsidiary, pending all necessary approvals. Eastern shareholders must approve the merger. ProAssurance shareholder approval is not needed.

The deal, which was unanimously approved by Eastern's board, is expected to close by the start of 2014.

“Eastern is a best-in-class workers' compensation specialist with a proven track record of delivering attractive growth and underwriting profit throughout the insurance cycle,” said ProAssurance CEO W. Stancil Starnes, in a statement. “Eastern has a strong, long-term position in healthcare workers' compensation that will allow us to broaden the high quality products we are able to offer our existing customers. Equally important is the product line diversification the transaction will provide for the combined organization.”

Birmingham, Ala.-based ProAssurance will maintain Eastern's corporate office in Lancaster and its existing regional and satellite offices under the direction of Michael Boguski, current president and CEO, and his management team.

Boguski said, “ProAssurance is the ideal long-term partner for us. They share our vision for profitably growing our workers' compensation business through targeted geographic expansion and value-added relationships with agency partners.”