BIRMINGHAM, Ala. and AUSTIN, Texas, Sept. 1 /PRNewswire-FirstCall/ --ProAssurance Corporation (NYSE: PRA) and American Physicians Service Group, Inc. (Nasdaq: AMPH) today announced they have entered into an agreement which calls for ProAssurance to acquire all the outstanding shares of American Physicians Service Group, Inc. (APS) in an all-cash transaction for $32.50 per share. The transaction is expected to close by year-end.
"This is an attractive strategic and financial acquisition for ProAssurance," said ProAssurance's Chairman and Chief Executive Officer, W. Stancil Starnes. "APS is the second largest writer of medical professional liability (MPL) insurance in Texas, so we expect this transaction to give ProAssurance a strong market presence in a state that has one of the most stable medical/legal environments in the country. In addition, APS' growth in Oklahoma and Arkansas complements our long-term commitment to those two markets. Financially, we anticipate this transaction will be accretive to our 2011 earnings, before one-time transaction and any restructuring costs."The Chairman and Chief Executive Officer of APS, Ken Shifrin, said, "ProAssurance is the ideal partner for us. Like APS, they were formed by physicians and retain a strong doctor focus. As an "A" rated carrier, they also offer the highest quality insurance protection for our policyholders. Importantly, along with the strength and stability they bring to our policyholders, they also bring a proven track record of successful integrations for our employees. Similarly, our shareholders also benefit from this alliance. In the last ten years, a period that has not been kind to many equity holders, our shareholders have enjoyed a steadily increasing stock price and this offer puts a dramatic finish on that extraordinary performance." Mr. Starnes explained why APS is an attractive partner for ProAssurance, "We think the Texas market will be a vital part of our continued growth. APS will bring us a solid insurance organization that understands and operates profitably in the Texas market and shares a similar commitment to customer service. We expect this combination to produce immediate, tangible benefits for our company." The Board of Directors of APS has determined that the transaction is in the best interests of APS' shareholders and, thus, has unanimously approved the merger and resolved to recommend that APS shareholders vote in favor of the transaction. The transaction is subject to customary conditions, including regulatory and APS' shareholder approval. There is no financing condition to consummate the transaction. Shareholder approval is not required for ProAssurance.