OneBeacon Insurance Group, Ltd. (NYSE:OB) CEO Mike Miller has a lot riding on the merger between his firm and INTACT FINL CORP COM NPV (OTCMKTS:IFCZF) from which he could make as much as $10 million.
Miller is expected to receive 40% of an agreed bonus once the merger between the two companies takes place. Intact will pay 30% on the first anniversary of the deal while the remaining 30 percent will be paid on the second anniversary of the closing.
OneBeacon’s board also seems to be in favor of the merger
OneBeacon’s board of directors reportedly voted in favor of the acquisition with Intact Financial Corp in May and the deal would be valued at $1.7 billion. Intact announced on May 2 that it struck a definitive agreement with the specialty insurer who agreed to the buyout.
“The merger will lead to the formation of a leading North American Specialty lines insurer with over $2 billion in specialty lines premiums,” Intact Finance stated.
Intact Finance therefore plans to buy out OneBeacon because of the strategic advantages that the merger will offer. It will allow the conglomerate to command the lead in the respective markets in North America, thus giving it the upper hand over the rest of the competition.
As for the terms of the merger deal, OneBeacon’s shareholders will receive $18.10 for every share categorized as common stock. They will also receive a 14% premium based on the closing price of the company’s stock at the New York Stock Exchange as of May 1, which was $15.89. The specialty insurer’s stockholders will also receive a 15% premium to the volume-weighted average price of the company’s stock over the past one month. This roughly adds up to $1.7 billion as revealed by Intact. The acquisition is expected to boost Intact’s business through cross-border capabilities and new products.
OneBeacon stock closed the latest trading session on June 1 at $18.35.