Jan 6 Tower Group International Ltd
said it would be bought by ACP Re Ltd, a privately owned
reinsurance company, for $172 million.
ACP Re offered $3 in cash for each Tower Group share, a
premium of 2.4 percent to the stock's Friday closing. Tower
Group's shares were trading at $2.96 before the bell on Monday.
Tower's shares fell about 82 percent last year as the
company repeatedly delayed filing second-quarter results and
tripled its expected loss reserves.
The company said in October it was reviewing strategic
options and that it would cut about 10 percent of its workforce.
Bermuda-based ACP Re is controlled by a trust established by
the founder of AmTrust Financial Services Inc, National
General Holdings Corp and Maiden Holdings Ltd
Tower Group Chief Executive Michael Lee, who owns 4.2
percent of the company, has agreed to vote in favor of the
In a separate press release, AmTrust Financial Services Inc
said it would buy renewal rights and assets of the commercial
lines insurance operations of Tower for about $125 million.
The transaction is expected to close by the summer of 2014.
J.P. Morgan Securities was the lead adviser to Tower, while
Guggenheim Securities LLC advised AmTrust.