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Berkshire Bids for Transatlantic Holdings

Stocks in this article: BRK-A BRK-B TRH

NEW YORK ( TheStreet) -- Reinsurer Transatlantic Holdings (TRH) announced Sunday it has received a $3.25 billion buyout offer from National Indemnity Company, a unit of Warren Buffett's Berkshire Hathaway (BRK.A).

In a news release, Transatlantic says National Indemnity is offering $52 for each of its outstanding shares, a 15% premium to Transatlantic's Friday closing price of $45.24.

In June, Transatlantic agreed to merge with Allied World Assurance Company (AWH - Get Report). Under the terms of that deal, Transatlantic shareholders would receive 0.88 Allied World shares for each Transatlantic share. Based on Allied World's Friday closing share price of $50.25, that deal values Transatlantic at $44.22 a share, or $2.76 billion.

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In Sunday's news release, Transatlantic said its board would "carefully consider and evaluate" the proposal from the Berkshire Hathaway unit. "Transatlantic advises stockholders to take no action at this time and to await the Board's recommendation," the release added.

Berkshire's Class-A shares closed Friday's session up $550 at $107,300, while its Class-B shares ended the day up $26 at $71.25.

>> Get your merger and acquisition news on the go with TheStreet's iPad app.

This article was written by a staff member of TheStreet.

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