By Ben Otto
U.S. insurance giant Allstate Corp. said it has agreed to acquire peer National General Holdings Corp. for about $4 billion in cash, expanding its reach in the personal property-liability business.
Under the deal, shareholders of National General /zigman2/quotes/202458366/composite NGHC -0.06% , a New York-based specialty personal-lines insurer, will receive a total of $34.50 a share, an offer that comprises $32.00 a share from Allstate /zigman2/quotes/201974803/composite ALL -1.64% and expected closing dividends of $2.50 a share, the companies said late Tuesday. The total offer represents a 69% premium to the stock’s last-traded price.
Allstate, a top issuer of auto and home insurance policies, will fund the deal with $2.2 billion in cash resources and by issuing $1.5 billion in new senior debt. National General’s board has approved the transaction, which includes a breakup fee of $132.5 million. The companies said the deal is expected to close early next year, subject to regulatory approvals.
The acquisition “accelerates Allstate’s strategy to increase market share in personal property-liability and significantly expands our independent agent distribution,” said Tom Wilson, chairman and chief executive of Allstate, which is based in Northbrook, Ill.
Most popular at WSJ.com :
Write to Ben Otto at email@example.com