Troubled insurer Tower Group has agreed to sell itself to ACP Re, the parent company of National General Holdings and AmTrust Financial, which will take over personal and commercial lines respectively.
An ACP Re subsidiary will buy Tower Group for approximately $3 per share, releases from National General and AmTrust say. Total purchase price for the personal lines business is expected to be approximately $130 million, while commercial is about $125 million.
"This transaction will introduce homeowners and umbrella coverage into our product offerings which will allow us to bundle these coverages with our existing auto business and make our product offerings even more competitive," says Michael Karfunkel, Chairman and CEO of National General, in a statement.
AmTrust president and CEO Barry Zyskind added in a statement that he "expect[s] that the Tower book of business will further establish AmTrust as a market leader in the small commercial insurance business."
TowerGroup CIO Sal Abano left the company for MajescoMastek last year.