AIG to acquire VALIDUS for USD 5.56 billion in cash

American International Group (AIG) announced it will acquire all the outstanding common shares of VALIDUS Holdings for an aggregate transaction value of USD 5.56 billion, in cash.

"The transaction enhances AIG's General Insurance business, adding a leading reinsurance platform (VALIDUS Re), an insurance-linked securities asset manager (AlphaCat), a meaningful presence at Lloyd's (TALBOT) and complementary capabilities in the U.S. crop and excess and surplus (E&S) markets (WESTERN WORLD)," AIG announced in a statement.

Holders of VALIDUS common shares will receive cash consideration of USD 68.00 per share, for an aggregate transaction value of USD 5.56 billion, funded by cash on hand

The deal has been unanimously recommended by the boards of directors of both companies, and is expected to close in mid-2018, subject to regulatory approvals.

"VALIDUS is an excellent strategic fit for AIG, bringing new businesses and capabilities to our General Insurance operation, expanding the bench of our management team and deepening our underwriting expertise," said Brian DUPERREAULT, President and Chief Executive Officer of AIG.

"With our global scale and the strength of our balance sheet, I am confident that VALIDUS will thrive within AIG and strengthen our ability to deliver profitable growth for our shareholders as we strategically position AIG for the future."

Ed NOONAN, VALIDUS' Chairman and Chief Executive Officer, said, "We believe this transaction offers compelling value for our shareholders and reflects the strength of the business we've built together with our talented global team. Joining AIG and becoming part of a larger, more diversified organization immediately opens new opportunities for our people and our franchise. VALIDUS will be able to serve clients and brokers in new and exciting ways, which will enhance our ability to grow profitably."

Peter ZAFFINO, AIG's Chief Executive Officer, General Insurance, said, "I have worked with and admired VALIDUS since its formation and have the utmost respect for what the management team has achieved. They have built a business that is highly compatible with AIG's General Insurance business. Brokers and customers of both companies will benefit from this acquisition, and I look forward to all that we will be able to accomplish by bringing VALIDUS into AIG."

Citigroup Global Markets Inc., Perella Weinberg Partners LP and Debevoise & Plimpton LLP advised AIG on the transaction.

VALIDUS was advised by J.P. Morgan Securities LLC and Skadden, Arps, Slate, Meagher & Flom LLP.

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