Amended Merger Agreement Increases Purchase Price
by $1.25 per share, or 9.3%, to $14.75 Per Share in Cash
AmTrust Financial Services, Inc. (Nasdaq:AFSI) (the "Company" or
"AmTrust") announced today that it has entered into an amendment to
the merger agreement with Evergreen Parent, L.P., an entity formed
by the Karfunkel-Zyskind Family and private equity funds managed by
Stone Point Capital LLC (“Stone Point”). Under the terms of
the amended agreement, Evergreen will acquire 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 for $14.75 per share in cash, subject to
regulatory approval and other closing conditions. This represents
an increase of $1.25 per share, or 9.3%, in cash consideration to
AmTrust public stockholders, over the previously agreed upon $13.50
per share, and a 45% premium to the Company’s unaffected closing
stock price on January 9, 2018.
The transaction values the fully diluted equity of the Company
at approximately $2.95 billion, excluding the Company's outstanding
preferred stock.
Don DeCarlo, Chairman of the Special Committee, said: “The
amended agreement follows significant engagement with our public
stockholders, and is consistent with our commitment to maximize
value for public stockholders. We continue to believe that the
immediate, certain, premium value provided in this agreement is in
the best interest of AmTrust’s public stockholders and look forward
to the completion of the transaction.”
The Special Committee has unanimously approved the revised
merger agreement and recommends that public stockholders vote “FOR”
the revised agreement.
AmTrust also announced that AmTrust and Evergreen Parent have
entered into a settlement and support agreement with affiliates of
Carl C. Icahn (the “Icahn Group”) pursuant to which the Icahn Group
has agreed to support the transaction and waive appraisal rights
and other claims with respect to the transaction.
Mr. Icahn commented: “We are pleased that we were able to work
with George Karfunkel and Barry Zyskind to reach a settlement that
is in the best interest of all stockholders. By raising the merger
price to $14.75, over $100 million of incremental value has been
created for public stockholders. Most importantly, we want to thank
all the stockholders whose vital support was so critical to
achieving this outcome.”
The amendment to the merger agreement and supplement to the
proxy statement will be filed with the Securities and Exchange
Commission, and the proxy supplement and voting information will be
mailed to stockholders as of the record date of April 5, 2018.
The Special Meeting to approve the adoption of the merger
agreement, as amended, between the Company and Evergreen Parent,
L.P., which was originally convened and adjourned for additional
time for voting, will be reconvened on Thursday, June 21, 2018 at
10:00 a.m. (Eastern time), at 59 Maiden Lane, 43rd Floor, New York
City. The final vote count will be certified by the independent
Inspector of Elections, First Coast Results, Inc.
The proposed merger is anticipated to close in the second half
of 2018 and is subject to approval by a majority of the shares of
the Company not owned or controlled by the Karfunkel-Zyskind
Family, and certain related parties as set forth in the
merger agreement, as well as approval by regulatory
authorities.
Stockholders that previously voted “FOR” the merger agreement
proposal do not need to vote again unless they wish to change their
vote. Stockholders that previously voted against or abstained on
the merger proposal or that did not vote by proxy are strongly
recommended to vote “FOR” the merger agreement proposal and the
certain value of$14.75 in cash.
AmTrust stockholders who have questions
or need assistance in voting their shares, please contact AmTrust’s
proxy solicitor:
MacKenzie Partners, Inc. 1407
Broadway, 27th Floor New York, New York 10018 (212) 929-5500 (Call
Collect) Call Toll-Free (800) 322-2885 Email:
AmTrust@mackenziepartners.com
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.
About Stone Point Capital
Stone Point Capital LLC (www.stonepoint.com) is a financial
services-focused private equity firm based in Greenwich, CT. The
firm has raised and managed seven private equity funds — the
Trident Funds — with aggregate committed capital of approximately
$19 billion. Stone Point targets investments in the global
financial services industry, including investments in companies
that provide outsourced services to financial institutions, banks
and depository institutions, asset management firms, insurance and
reinsurance companies, insurance distribution and other
insurance-related businesses, specialty lending and other credit
opportunities, mortgage services companies and employee benefits
and healthcare companies.
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, including
litigation relating to the proposed merger. 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 It In
connection with the proposed transaction, the Company has filed
with the Securities and Exchange Commission (the “SEC”) a
definitive proxy statement on Schedule 14A and may file other
documents with the SEC regarding the proposed transaction,
including any supplemental disclosure relating to the merger
agreement amendment. 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.
MacKenzie Partners, Inc. 1407
Broadway, 27th Floor New York, New York 10018 (212) 929-5500 (Call
Collect) Call Toll-Free (800) 322-2885 Email:
AmTrust@mackenziepartners.com
Participants in the Solicitation The 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
Hunter HoffmannGlobal Director of Public
RelationsHunter.Hoffmann@amtrustgroup.com(646) 458-3362
Additional Investor Contacts:
MacKenzie Partners, Inc.Jeanne Carr (212)
929-5916Larry Dennedy (212) 929-5239Daniel Burch (212)
929-5748AmTrust@mackenziepartners.com
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