National General’s board of directors has approved the transaction, which includes customary terms and conditions, including a breakup fee of $132.5 million. A voting agreement has also been signed with entities controlling 40% of National General’s common shares to vote for the transaction.
MSD Capital, which owns approximately 7.4% of National General’s outstanding common shares, also supports the transaction. “As proud shareholders since 2013, we support the decision of National General’s board of directors to move forward with this strategic transaction,” said John Phelan, Managing Partner and Co-Founder of MSD Capital, LP and MSD Partners, LP. Dan Bitar, a Managing Director of MSD Capital, added, “We believe the transaction is allowing National General’s employees, customers and shareholders to benefit from the significant franchise value created by the management team over the last decade.”
Ardea Partners LP was the exclusive financial adviser to Allstate, and Willkie Farr & Gallagher LLP was the company’s legal adviser. J.P. Morgan Securities LLC was the exclusive financial adviser to National General, and Paul, Weiss, Rifkind, Wharton & Garrison LLP was National General’s legal counsel.
Webcast
Allstate will conduct a teleconference and webcast at 7:30 a.m. Central Time on Wednesday, July 8, to discuss the acquisition. The investor webcast can be accessed at www.allstateinvestors.com. A replay and downloadable audio file will be posted on the company’s website shortly after the event ends.
About Allstate
The Allstate Corporation (NYSE: ALL) protects people from life’s uncertainties with more than 153.7 million proprietary policies. Allstate offers a broad array of protection products through multiple brands and diverse distribution channels, including auto, home, life and other insurance. Allstate is widely known from the slogan “You’re in Good Hands with Allstate.”
Financial information, including material announcements about The Allstate Corporation, is routinely posted on www.allstateinvestors.com.
About National General
National General, headquartered in New York City, is a specialty personal lines insurance holding company serving a wide range of customer segments through a network of approximately 42,300 independent agents for property-casualty products. National General traces its roots to 1939, has a financial strength rating of A- (excellent) from A.M. Best, and provides personal and commercial automobile, homeowners, umbrella, recreational vehicle, motorcycle, lender-placed, supplemental health and other niche insurance products. Auto insurance represents approximately 60% of premium with a significant presence in the non-standard auto market. Its property-casualty business was built through a combination of organic growth and opportunistic acquisitions. National General earns attractive margins and generated operating return on average equity in excess of 16% in 2019, with net income of $314 million, up 79% from the prior year. Gross premiums written in 2019 were $5.6 billion.
Additional Information and Where to Find It
This press release may be deemed to be solicitation in respect of the transaction. In connection with the transaction, National General intends to file relevant materials with the SEC, including National General’s proxy statement on Schedule 14A. National General stockholders are urged to read all relevant documents filed with the SEC, including National General’s proxy statement when it is available, because they will contain important information about the transaction. Investors and security holders will be able to obtain the documents free of charge on the SEC’s website at www.sec.gov, and National General stockholders will receive information at an appropriate time on how to obtain documents free of charge from National General that are not currently available.
National General and its directors and executive officers may be deemed to be participants in the solicitation of proxies from the holders of National General common stock in respect of the transaction. Information about National General’s directors and executive officers is set forth in the proxy statement for National General’s 2020 Annual General Meeting of Shareholders, which was filed with the SEC on March 12, 2020. Investors may obtain additional information regarding the interest of such participants by reading the proxy statement regarding the transaction when it becomes available.
