Mitsui Sumitomo Insurance Company (MSI) has announced it is to acquire Amlin Insurance, which has offices in Bermuda.
MSI, which is part of the MS&AD Group, will pay ¥634.7 billion (£3.4 billion) for Amlin, which provides insurance cover to commercial enterprises and reinsurance protection to other insurance companies worldwide.
It has not yet been said whether the deal with result in the closure of any of Amlin’s offices, including those in Bermuda.
A representative for MSI said that the agreement was based on “growth” and that the two firms were “very complementary to each other.”
Charles Philipps, chief executive of Amlin, said the deal would provide Amlin with the “financial muscle” and scale to succeed long term.
The transaction represents a price of 670 pence for each Amlin share, a premium of some 36 percent over the company’s closing price of 492.5 pence per share on Monday September 7, before news of the deal broke. It also represents a premium of 33.8 percent on the weighted average of the share price in the three month period to September 7.
Amlin shareholders on the record date (4 September 2015) will be entitled to receive an interim dividend of 8.4 pence per Amlin share for the period ended 30 June 2015 that is payable on 1 October 2015.
Yasuyoshi Karasawa, president and chief executive of MSI, said: “We are delighted to be announcing the combination of MSI and Amlin to create a world-leading insurance company, with an international business anchored in the Lloyd's market.
“The combination will accelerate MSI's strategy of growing its international business, and drive a number of benefits across Amlin's business as a result of it being part of a substantially larger group.”
Philipps said: “We believe that this combination is extremely compelling. We have always had a very high regard for MSI, our strategies and corporate values are closely aligned, and this transaction will now provide Amlin with the increased scale and financial muscle that will be required for long term success in our industry. It delivers excellent value for shareholders, improved career prospects for our employees, and enhanced continuity and security for our clients.
“I am confident that, with our combined skills and geographic coverage, we will continue to go from strength to strength. We believe that our respective Lloyd's, Bermudian and European businesses fit well together and will allow increased development opportunities. MSI's presence in the ASEAN region and its ambitions in the United States clearly offer very exciting prospects for Amlin.”
“We are looking forward to working closely with MSI's management and the MSI teams with whom we will be combining.”
Mitsui Sumitomo Insurance Company, Amlin, Charles Philipps, Yasuyoshi Karasawa, Lloyds, Europe, Asia-Pacific, Bermuda