Loading...
Loading...
RenaissanceRe Holdings Ltd.
RNR (“RenaissanceRe” or the “Company”) and
Platinum Underwriters Holdings, Ltd.
PTP (“Platinum”) announced today
that the companies have entered into a definitive merger agreement under which
RenaissanceRe will acquire Platinum. Under the terms of the transaction, the
common shareholders of Platinum will receive $76.00 per common share in stock
and cash, or approximately $1.9 billion. RenaissanceRe expects the transaction
to be accretive to book value per share and earnings per share and that the
combined company will have substantial financial strength and flexibility
post-closing.
Kevin J. O'Donnell, President and Chief Executive Officer of RenaissanceRe,
commented: “We are very pleased to have entered into the definitive agreement
to acquire Platinum. It is a well-run company and its integration with
RenaissanceRe will benefit our combined companies' clients through an expanded
product offering and broker relationships. It will also accelerate the growth
of our U.S. specialty and casualty reinsurance platform and as a result,
create enhanced value for our shareholders.”
Mr. O'Donnell continued: “Platinum is a company we know well as we supported
its formation and initial public offering in 2002. Platinum's disciplined
approach to underwriting and risk management is a strategic and cultural fit
for RenaissanceRe and its book of business will be integrated within our risk
management framework. After the transaction closes, we anticipate our combined
company will continue to have the very strong capital and liquidity position
you have come to expect from RenaissanceRe.”
The aggregate consideration for the transaction will consist of 7.5 million
RenaissanceRe common shares, valued at approximately $761 million, and $1.16
billion of cash. The cash consideration will be funded through a pre-closing
dividend from Platinum, RenaissanceRe available funds and the proceeds from
the issuance of new senior debt.
The acquisition price of $76.00 represents a 24% premium to Platinum's closing
price per common share as of November 21, 2014. At closing, Platinum
shareholders will receive a $10.00 per share special pre-closing dividend and
will be entitled to elect to receive, for each Platinum share held, either (i)
$66.00 in cash, (ii) 0.6504 RenaissanceRe common shares or (iii) 0.2960
RenaissanceRe common shares and $35.96 in cash. All elections will be subject
to proration such that RenaissanceRe issues exactly 7.5 million common shares.
Following completion of the transaction, Platinum's existing shareholders will
own approximately 16% of RenaissanceRe's outstanding shares.
RenaissanceRe's senior management team, led by Kevin O'Donnell, and eleven
member Board of Directors will remain in place. The combined company will
retain RenaissanceRe's name and headquarters.
For the twelve months ended September 30, 2014, the two companies had pro
forma gross premiums written of $2.0 billion. Shareholders' equity will
increase from $3.7 billion to $4.5 billion and total cash and invested assets
will increase from $7.0 billion to $9.4 billion on a pro forma basis.
RenaissanceRe expects to achieve approximately $30 million of run-rate annual
cost savings and to realize meaningful capital efficiencies from the
combination.
The agreement has been unanimously approved by both companies' Boards of
Directors. The transaction is expected to close in the first half of 2015 and
is subject to customary regulatory approvals as well as the approval of
Platinum's shareholders.
Morgan Stanley & Co. LLC is acting as financial advisor to RenaissanceRe in
connection with the transaction and Willkie Farr & Gallagher LLP as legal
counsel. Wachtell, Lipton, Rosen & Katz is acting as legal counsel to
RenaissanceRe's Board of Directors in connection with the transaction.
Loading...
Loading...
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Posted In: NewsPress Releases
Benzinga simplifies the market for smarter investing
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
Join Now: Free!
Already a member?Sign in