Enstar Group and SeaBright have embarked into a definitive merger agreement pursuant to which the former will purchase the latter for $11.11 per share in cash, valuing the transaction for almost $252m.
As per the acquisition deal signed, the purchase price represents a 34.3% premium over SeaBright's closing stock price of $8.27.
In accordance with the clauses of the merger agreement, a newly floated wholly-owned subsidiary of Enstar will merge with and into SeaBright, with SeaBright surviving as a wholly-owned subsidiary of Enstar.
Enstar believes to finance the aggregate purchase price of nearly $252m through a mix of cash on hand and a bank loan facility to be finalized before closing.
The transaction, which is not conditioned on Enstar's ability to obtain financing, is expected to close in the first quarter of 2013, after getting regulatory approval.
Enstar chief executive officer Dominic Silvester said, "We continue to focus on expanding in the U.S., and we believe SeaBright will be a significant addition to our portfolio."
SeaBright chairman, president and chief executive officer John Pasqualetto added, "This transaction will, upon closing, provide our stockholders with immediate liquidity at a price representing a significant premium to market."
Sandler O'Neill + Partners provided financial advice and fairness opinion to SeaBright, while Kirkland & Ellis served as legal advisor and Mayer Brown offered services of a special regulatory counsel to SeaBright.
