AmTrust Financial Services, Inc.
Is the Proposed Acquisition Best for AmTrust and Its Shareholders?
On January 9, 2018, the family who originally helped found AmTrust Financial Services (AFSI) – the Karfunkel-Zyskind Family – along with private equity funds managed by Stone Point Capital, LLC offered a non-binding proposal pursuant to which Stone Point Capital, LLC will acquire all outstanding shares of AmTrust that the Karfunkel-Zyskind Family does not currently own. Under the terms of the agreement, AmTrust shareholders will receive $12.25 for each share of AmTrust common stock.
As an initial matter, the $12.25 merger consideration represents a premium of only 19.6% based on AmTrust’s closing price on December 7, 2017, which is below the average 1-month premium of nearly 23.58% for comparable transactions within the past five years. Further, the $12.25 merger consideration is significantly below the target price of $16.00 set by an analyst at SunTrust Robinson on November 27, 2017, and $15.00 set by an analyst at Compass Point on December 22, 2017. In the last three years, AmTrust traded as high as $35.94 on August 4, 2015, and most recently traded above the merger consideration – at $12.37 – on November 8, 2017.
AmTrust shareholders have the option to file a class action lawsuit to ensure the board of directors obtains the best possible price for shareholders and the disclosure of material information. AmTrust shareholders interested in information about their rights and potential remedies can submit their information in the contact form below.