Second Independent Proxy Advisory Firm Recommends
AmTrust Stockholders Support Value Maximizing Transaction
AmTrust Financial Services, Inc. (Nasdaq:AFSI) (the "Company" or
"AmTrust") today reiterated the unanimous recommendation of its
Board of Directors that stockholders vote “
FOR”
the Company’s previously announced merger agreement at the Special
Meeting of stockholders on June 4, 2018. Under the terms of the
merger agreement, Evergreen Parent, L.P. will acquire for $13.50
per share in cash the approximately 45% of the Company's shares of
common stock that the Karfunkel-Zyskind Family and certain of its
affiliates and related parties do not already own or control,
subject to regulatory approval and other closing conditions.
It is important that all AmTrust stockholders vote
today. The support of a majority of unaffiliated stockholders is
required to approve the transaction.
AmTrust also announced that leading proxy advisory firm
Egan-Jones has joined Glass Lewis & Co. in recommending that
AmTrust stockholders vote “FOR” the transaction.
In its May 29, 2018 report, Egan-Jones stated1:
“Based on
the review of publicly available information on strategic,
corporate governance and financial aspects of the proposed
transaction, Egan-Jones views the proposed transaction to be a
desirable approach in maximizing shareholder value. After careful
consideration, we believe that approval of the merger is in the
best interests of the Company and its shareholders and its
advantages and opportunities outweigh the risks associated to the
transaction.” |
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1 Permission to use quotations neither sought nor obtained
AmTrust issued the following statement:
We are
pleased that these two leading proxy advisory firms have joined
independent industry analysts and our Board in recognizing the
premium value provided by the merger and the significant downside
risks faced by public stockholders should the merger not be
approved. In its report, even Institutional Shareholder Services
Inc. (“ISS”) acknowledged that there could be a decline in
AmTrust’s stock price if the merger is rejected, notwithstanding
ISS’s flawed conclusion to recommend against.The proposed
transaction is the culmination of a rigorous, public process led by
an experienced, independent Special Committee of the AmTrust Board.
Collectively, the four independent directors on the Special
Committee have over 125 years of experience in the insurance
industry, enabling them to evaluate both the opportunities and the
risks facing AmTrust as well as the value provided through the
going-private transaction.In considering the transaction, the
Special Committee met 28 times, assisted by independent legal and
financial advisors. The intense negotiations led by the Special
Committee resulted in three price increases. The price ultimately
agreed upon of $13.50 per share in cash represents a 33% premium to
AmTrust’s unaffected stock price and a 10% increase in value over
the buyer group’s initial proposal.Over the 4.5 months since the
proposal was announced, no other acquisition proposal or indication
of interest from any third party has been received, and in prior
approaches to the Karfunkel-Zyskind Family, no one has expressed an
interest in buying the Company on their own.AmTrust stockholders
are now faced with a choice: vote “FOR” the
certain value of $13.50 per share in cash or accept the continuing
risks of being a stockholder of AmTrust in a time of significant
uncertainty in the business and its future prospects. The Board
believes the choice to maximize value is clear and urges
stockholders to protect the value of their investment by voting
“FOR” the proposed transaction today. |
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Time is short. With the Special Meeting less than a week
away, it is important that stockholders vote as soon as possible by
internet or by telephone. AmTrust reminds stockholders
that their vote is important, no matter how many shares they own;
failing to vote or abstaining from voting is effectively a vote
against the transaction.
AmTrust stockholders who have questions or need assistance
invoting their shares, please contact AmTrust’s
solicitor:MacKenzie Partners, Inc.1407
Broadway, 27th FloorNew York, New York 10018(212) 929-5500 (Call
Collect)Call Toll-Free (800) 322-2885Email:
Amtrust@mackenziepartners.com |
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About AmTrust Financial Services, Inc.AmTrust
Financial Services, Inc., a multinational insurance holding company
headquartered in New York, offers specialty property and casualty
insurance products, including workers' compensation, commercial
automobile, general liability and extended service and warranty
coverage through its primary insurance subsidiaries rated "A"
(Excellent) by A.M. Best. AmTrust is included in the Fortune 500
list of largest companies. For more information about AmTrust visit
www.amtrustfinancial.com.
Forward Looking StatementsThis news release
contains certain forward-looking statements that are intended to be
covered by the safe harbors created by the Private Securities
Litigation Reform Act of 1995. When we use words such as
"anticipate," "intend," "plan," "believe," "estimate," "expect," or
similar expressions, we do so to identify forward-looking
statements. Examples of forward-looking statements include the
plans and objectives of management for future operations, including
those relating to future growth of our business activities and
availability of funds, and estimates of the impact of material
weaknesses in our internal control over financial reporting, and
are based on current expectations that involve assumptions that are
difficult or impossible to predict accurately and many of which are
beyond our control. Actual results may differ materially from those
expressed or implied in these statements as a result of significant
risks and uncertainties, including, but not limited to, the
occurrence of any event, change or other circumstances that could
give rise to the termination of the merger agreement, including as
a result of any downgrade in the A.M. Best Financial Strength
Rating of the Company’s insurance subsidiaries below “A”, which
risk may be heightened due to the fact that such ratings are
currently “under review with negative implications” and that the
Company has previously disclosed material weaknesses in its
internal controls over financial reporting, the inability to obtain
the requisite stockholder approval for the proposed merger or the
failure to satisfy other conditions to completion of the proposed
merger, risks that the proposed transaction disrupts current plans
and operations, the ability to recognize the benefits of the
merger, the amount of the costs, fees, expenses and charges related
to the merger, non-receipt of expected payments from insureds or
reinsurers, changes in interest rates, changes in tax laws, the
effect of the performance of financial markets on our investment
portfolio, the amounts, timing and prices of any share repurchases
made by us under our share repurchase program, development of
claims and the effect on loss reserves, accuracy in projecting loss
reserves, the cost and availability of reinsurance coverage, the
effects of emerging claim and coverage issues, changes in the
demand for our products, our degree of success in integrating
acquired businesses, the effect of general economic conditions,
state and federal legislation, regulations and regulatory
investigations into industry practices, our ability to timely and
effectively remediate the material weakness in our internal control
over financial reporting and implement effective internal control
over financial reporting and disclosure controls and procedures in
the future, access to public markets to raise debt or equity
capital, risks associated with conducting business outside the
United States, the impact of Brexit, developments relating to
existing agreements, disruptions to our business relationships with
Maiden Holdings, Ltd. or National General Holdings Corp., breaches
in data security or other disruptions with our technology, any
inability to keep pace with technological advances, heightened
competition, changes in pricing environments, changes in asset
valuations and the results of legal proceedings. Additional
information about these risks and uncertainties, as well as others
that may cause actual results to differ materially from those
projected, is contained in our filings with the SEC, including our
Annual Report on Form 10-K and our quarterly reports on Form 10-Q.
The projections and statements in this news release speak only as
of the date of this news release and we undertake no obligation to
update or revise any forward-looking statement, whether as a result
of new information, future developments or otherwise, except as may
be required by law.
Additional Information and Where to Find ItIn
connection with the proposed transaction, the Company has filed
with the Securities and Exchange Commission (the “SEC”) a proxy
statement on Schedule 14A and may file other documents with the SEC
regarding the proposed transaction. This letter is not a substitute
for the proxy statement or any other document that the Company may
file with the SEC. INVESTORS IN AND SECURITY HOLDERS OF THE COMPANY
ARE URGED TO READ THE PROXY STATEMENT AND ANY OTHER RELEVANT
DOCUMENTS THAT ARE FILED OR WILL BE FILED WITH THE SEC, AS WELL AS
ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN
THEIR ENTIRETY BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION AND RELATED MATTERS.
Investors and security holders may obtain free copies of the proxy
statement and other documents filed with the SEC by the Company
through the web site maintained by the SEC at www.sec.gov or by
contacting the investor relations department of the Company or
MacKenzie Partners, Inc., the Company’s proxy solicitor.
Participants in the SolicitationThe Company and
its directors and executive officers may be deemed to be
participants in the solicitation of proxies in connection with the
proposed transaction. Information regarding the Company’s directors
and executive officers, including a description of their direct
interests, by security holdings or otherwise, is contained in the
Company’s Annual Report on Form 10-K for the year ended December
31, 2017 as amended on Form 10-K/A filed with the SEC on April 23,
2018. A more complete description is available in the proxy
statement on Schedule 14A filed with the SEC on May 4, 2018. You
may obtain free copies of these documents as described in the
preceding paragraph.
Contacts
AmTrust Financial ServicesChaya CooperbergChief
Communications Officer & SVP Corporate
Affairschaya.cooperberg@amtrustgroup.com(646) 458-3332
Jisoo SuhDirector of Investor
Relationsjisoo.suh@amtrustgroup.com(646) 458-3367
Hunter HoffmannGlobal Director of Public
RelationsHunter.Hoffmann@amtrustgroup.com(646) 458-3362
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