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After successfully shedding some weight, a leaner Flagstone Reinsurance Holdings SA has agreed to be acquired by Validus Holdings Ltd., arguably Bermuda's hungriest reinsurer, for approximately $623.2 million.
Under the terms of an agreement, which the boards of the two entities have approved, Validus will offer 0.1935 of a common share plus $2 in cash for each Flagstone share -- a deal that provides Flagstone shareholders with a 19.4% premium and $8.43 of value per share based on the closing share price of Validus and Flagstone on Aug. 29.
The combination will create one of the best capitalized companies in Bermuda with $4 billion in combined shareholders equity and a powerhouse in the catastrophe risk space, adding about $291.6 million of property cat reinsurance premium to Validus' cat book, Chairman and CEO Ed Noonan said on an Aug. 30 conference call.
Noonan said Validus was first approached in March about participating in a potential...