Alleghany Corporation (NYSE: Y) (“Alleghany”) and Transatlantic Holdings, Inc. (“Transatlantic”) today announced the closing of their previously announced combination, creating a leading franchise across specialty insurance and reinsurance lines. With the closing of the transaction, Transatlantic becomes an operating subsidiary of Alleghany, and is expected to increase Alleghany’s breadth of distribution, diversify its underwriting activities and add to its financial strength and flexibility.
Pursuant to the terms of the merger agreement signed on November 20, 2011, former Transatlantic stockholders are entitled to receive, for each share of Transatlantic common stock held, either shares of Alleghany common stock or cash consideration with a value equal to $61.14, which is the sum of (i) 0.145 multiplied by the average of the closing sales prices on the NYSE for Alleghany common stock during the five trading days ending the day before the completion of the merger and (ii) $14.22. In addition, the Alleghany Board of Directors has been expanded to include former Transatlantic directors Stephen P. Bradley, Ian H. Chippendale and John G. Foos. Current Transatlantic President and CEO Michael C. Sapnar will continue to serve in that capacity. In connection with the transaction, reinsurance industry veteran Joseph P. Brandon has been appointed as President of Alleghany Insurance Holdings LLC, Executive Vice President of Alleghany and Chairman of Transatlantic’s Board.
The closing follows the satisfaction of all conditions to closing of the merger, including receipt of certain regulatory approvals and receipt of approval of the transaction by Alleghany and Transatlantic stockholders, which stockholder approvals were obtained on February 6, 2012.
Weston M. Hicks, President and CEO of Alleghany commented on the transaction’s closing, stating, “I am very pleased to welcome Transatlantic into the Alleghany family. Together we expect to have the flexibility to allocate our capital to the highest risk-adjusted return opportunities in insurance and reinsurance. I believe that our similar cultures, values and objectives will help ensure a seamless transition.” Mr. Hicks continued, “I am especially pleased to welcome Joe Brandon and Mike Sapnar to our leadership ranks, and I expect their talents, insights and industry relationships will contribute greatly to our efforts to manage Alleghany’s growing reinsurance operations.”