Toronto's Fairfax Financial Holdings says it is in line to buy specialty insurer American Safety Insurance Holdings for about $306 million.
“We expect to enhance our insurance operations in certain specialty lines of business with American Safety's expertise,” says Fairfax CEO Prem Watsa, in a statement.
American Safety's board of directors has unanimously approved the merger agreement and is recommending stockholders—who are in line to get $29.95 per share in cash—do the same.
Fairfax says it has additionally entered into an agreement with Tower Group International to sell it American Safety Reinsurance after acquiring the reinsurer from American Safety Holdings, of Bermuda.
Several of American Safety's specialty lines groups are expected to move to Fairfax's Crum & Forster and Hudson Insurance.
“Our specialty insurance platform will fit well into subsidiaries Crum & Forster and Hudson Insurance Group, facilitating a seamless transition for our customers,” says American Safety CEO Stephen R. Crim. “I want to express my deep gratitude to our employees, business partners, management and board for their role in building our successful specialty insurance company.”
The transaction is expected to close in the fourth quarter.
Last month Fairfax and pet insurance provider Hartville Group agreed to the terms of a deal, making Canton, Ohio's Hartville wholly-owned by Crum & Forster's United States Fire Insurance Company. This transaction is expected to close early in the third quarter of 2013.
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