HAMILTON, Bermuda & NEW YORK, N.Y.--(BUSINESS WIRE)--Sirius International Insurance Group, Ltd., a global multi-line insurance and reinsurance group, and Easterly Acquisition Corp. (NASDAQ:EACQ) announced that they have executed a definitive agreement and plan of merger for a proposed business combination that would result in Sirius becoming a publicly listed company. Under the terms of the Merger Agreement, Easterly would merge with a subsidiary of Sirius Group and become a wholly owned subsidiary of Sirius Group. Upon the closing of the Merger, Easterly’s common stock would be exchanged for Sirius Group’s common shares at a price of 1.05x Sirius Group’s pro forma diluted GAAP book value per share as of June 30, 2018. Following the Merger, Sirius Group’s common stock will be traded on the NASDAQ.
Assuming no redemptions by Easterly stockholders, the proposed all-stock transaction is expected to yield a combined entity with a pro forma market capitalization of approximately $2.2 billion at closing, with current Easterly stockholders owning approximately 7% of the combined company immediately following the Merger. Pursuant to the Merger Agreement, Sirius intends to execute a private placement of common shares and request Easterly to commence a tender offer to purchase Easterly’s public warrants on terms to be mutually agreed upon between Sirius and Easterly.
“We are pleased to become a public company though our partnership with Easterly,” said Allan Waters, President, CEO and Chairman of Sirius Group. “Access to the public equity markets will facilitate and accelerate our future growth via M&A transactions and organically.”
“We are excited to bring a company of the scale and stature of Sirius into the public markets,” said Avshalom Kalichstein, CEO of Easterly. “We believe this transaction will offer tremendous value to our shareholders.”
Easterly has scheduled a special meeting of its stockholders for June 28, 2018 to approve an extension of time to complete a business combination through November 30, 2018. Assuming that Easterly’s stockholders approve the extension period, Sirius Group has agreed to lend to Easterly $0.03 per month through the extension period for each public share that is not redeemed at Easterly’s special meeting of its stockholders on June 28, 2018. Easterly will deposit such loan proceeds into its trust account upon receipt. The loan will be forgiven if the Merger does not close by November 30, 2018.
In addition, the agreement for Sirius Group to acquire a controlling interest in The Phoenix Holdings Ltd. will terminate on or prior to July 2, 2018.
Established in 1945, Sirius Group, utilizing its unique global branch network, provides multi-line insurance and reinsurance in over 140 countries. Sirius Group wrote gross written premiums of $1.4 billion in 2017. Sirius Group is a Bermuda-based holding company with operating companies in Bermuda, Stockholm, New York and London.
Sirius Group’s principal equity holder is CMIG International Holding Pte. Ltd. (“CMIG International”). Singapore-based CMIG International is focused on international investments, asset management and cross-border M&A, and acquired Sirius Group from White Mountains Insurance Group, Ltd. in April 2016. CMIG International has four shareholders, major investor CMIG, is one of China’s leading private investment companies. It is registered in Shanghai with subsidiaries across many different sectors including new energies, healthcare, real estate, aviation, technology, finance and leasing. The other three ultimate shareholders are Hana Financial Group Inc., Sun Hung Kai & Co Limited and TBEA Co. Ltd. who are listed companies in Korea, Hong Kong and China respectively. CMIG International was recently awarded with S1000 (Singapore 1000 Company) Award in Singapore for its outstanding performance in the financial services field, and its determination to continue to meet the highest corporate governance standards. ABRY Partners, LLC, a Boston-based private equity investment firm focused on media, communications, insurance, business and information services, is also an equity owner of Sirius Group.
The Merger has been approved by the boards of directors of each of Sirius Group and Easterly, and is expected to close at the end of the third or beginning of the fourth quarter of 2018. Completion of the Merger is subject to the satisfaction of certain conditions including, but not limited to, approval of the transaction by Easterly’s stockholders, but is not subject to any insurance regulatory approvals or a minimum cash condition. The description of the transaction contained herein is only a summary and is qualified in its entirety by reference to the definitive Merger Agreement relating to the transaction, a copy of which has been filed by Easterly as an exhibit to a Current Report on Form 8-K.
Sirius Group is being represented by Sidley Austin LLP and Easterly is being represented by Hogan Lovells US LLP.
In addition to this press release, Sirius Group and Easterly are simultaneously issuing a slide presentation with information on the Merger, which has been furnished with the SEC as an exhibit to Easterly’s Current Report on Form 8-K filed today. Investors are encouraged to review these materials.
About Sirius Group
Sirius Group is a Bermuda-based holding company with (re)insurance operating companies in Bermuda, Stockholm, New York and London. Utilizing disciplined and professional underwriting, superior risk evaluation and best-in-class pricing technology, Sirius Group’s subsidiaries provide multi-line (re)insurance capacity in over 140 countries, including lead capacity for property, accident & health and other exposures. Additional information is available at Sirius Group's website located at www.siriusgroup.com.
About Easterly LLC
Easterly LLC is a private asset management holding company that has interests in boutique investment management firms. Easterly’s core expertise is in acting as a principal to grow business platforms. Easterly enhances businesses as a partner through capital formation, corporate development, and strategic implementation activities. Easterly’s principals have a proven track record of delivering outperformance to both public and private investors across a variety of sectors. For more information about Easterly, please visit Easterly’s website at www.easterlycapital.com.
About Easterly Acquisition Corp.
Easterly Acquisition Corp. is a Special Purpose Acquisition Company sponsored by Easterly Acquisition Sponsor, LLC, an affiliate of Easterly LLC, for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses or assets. Easterly Acquisition Corp. completed its initial public offering in August 2015, raising $200 million in cash proceeds. Easterly Acquisition Corp.’s officers and certain of its directors are affiliated with Easterly LLC. For more information about Easterly Acquisition Corp., please visit its website at www.easterlyacquisition.com.
