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Affirmative Insurance Holdings Inc Closes Sale of Retail Agency Business

Monday, 30 Sep 2013 01:00pm EDT 

Affirmative Insurance Holdings Inc announced that it closed the sale of its retail agency distribution business to Confie Seguros, California-based national insurance distribution company, for $100 million in cash with the potential to receive an additional $20 million of cash proceeds. Affirmative's retail agency business consists of 195 retail locations in Louisiana, Alabama, Texas, Illinois, Indiana, Missouri, Kansas, South Carolina and Wisconsin and two premium finance companies. The retail agency business employs approximately 500 employees. The Company previously had announced on September 16, 2013 that it entered into a definitive agreement to complete this sale. The initial $100 million of cash proceeds includes $20 million placed in an escrow account that will, dependent upon the risk-based capital status of Affirmative Insurance Company (AIC), be utilized to either infuse capital into AIC or pay down debt. The risk-based capital measurement will be made quarterly as of September 30, 2013 through June 30, 2014. addition, the Company may receive up to an additional $20 million of proceeds that could be used to pay down debt or infuse capital into AIC. The additional proceeds are contingent on AIC meeting certain risk-based capital thresholds. The measurement begins as of June 30, 2014 and can be achieved quarterly through December 31, 2015. 

Company Quote

-0.0199 -7.37%
3:50pm EDT