Swiss professional-liability insurer Allied World Assurance Co. Holdings Ltd., with operations in Farmington, has agreed to a $3.2 billion merger with New York medical malpractice insurer Transatlantic Holdings Inc., according to regulatory filings and published reports.
The deal is expected to close in the fourth quarter, according to Bloomberg News.
But one of Transatlantic’s biggest investors, Davis Selected Advisers LP, is posturing to block the deal, saying it may seek to line up alternative suitors.
If the merger doesn’t go through due to a change of heart on the part of directors, either Transatlantic or Allied World could be liable to pay the other a $135 million termination fee, according to Allied’s 8-K filing with the Securities and Exchange Commission.
If shareholders at either company balk, that company must pay the other a $35 million termination fee plus up to another $35 million in merger-related expenses, the filing states.
If the merger is successful, current Allied CEO Scott A. Carmilani run renamed TransAllied as president and CEO from Allied’s current corporate headquarters in Zug, Switzerland.
Transatlantic Chairman Richard Press would run TransAllied as non-executive chairman.
