Intact Financial to buy OneBeacon Insurance

TORONTO, ONTARIO–(Marketwired – May 2, 2017) –

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES

  • Creating a leading North American specialty lines insurer with over $2 billion in specialty lines premiums
  • Focuses on small to mid-size businesses where both organizations have deep capabilities and ability to scale up
  • Bolsters Intact’s existing Canadian business with new products and cross-border capabilities
  • Provides additional growth pipeline to leverage Intact’s consolidation expertise in a highly fragmented market
  • Accretive to net operating income per share within 24 months
  • Strong financial position maintained with MCT estimated above 200% at closing

Intact Financial Corporation (TSX:IFC) announced today that it has entered into a definitive agreement and plan of merger pursuant to which it has agreed to acquire OneBeacon Insurance Group, Ltd. (NYSE:OB), a leading US specialty insurer. Under the terms of the all-cash deal, OneBeacon shareholders will receive US$18.10 cash per common share, a 14% premium based on OneBeacon’s closing stock price on the NYSE of US$15.89 as of May 1, 2017 and a 15% premium to the volume weighted average price over the last 30 days. This represents an aggregate cash consideration of approximately US$1.7 billion ($2.3 billion). In addition, OneBeacon debt of approximately US$275 million will remain outstanding. The transaction has been unanimously approved by the Boards of Directors of both companies and is subject to approval by OneBeacon’s shareholders.

Intact’s acquisition of OneBeacon is creating a North American leader in specialty insurance, with over $2 billion of annual premiums. It combines Intact’s leading commercial lines track record and deep data, claims and digital expertise with OneBeacon’s high caliber team and specialty lines capabilities. The acquisition bolsters Intact’s Canadian business with new products and cross-border capabilities, and better positions Intact to compete with international insurers. Furthermore, this provides an additional growth pipeline to leverage Intact’s consolidation expertise in a fragmented specialty lines market.

“Today, we’ve taken an important step in building a world class P&C insurer. The addition of OneBeacon is creating a leading North American specialty lines insurer focused on small to mid-sized businesses,” said Charles Brindamour, CEO of Intact Financial Corporation. “OneBeacon is a strong strategic fit for Intact, with deep expertise in commercial and specialty lines, and shared values. We see significant growth potential from the combination of our specialty lines operations and we look forward to welcoming OneBeacon employees to the Intact family.”

Mike Miller, CEO of OneBeacon Insurance Group, said, “We are all very excited to join the Intact family. The opportunity to leverage Intact’s deep technical, financial and technology capabilities makes this combination the perfect next step in the OneBeacon journey. Together, we will accelerate our pursuit in creating a leading specialty insurer in North America. We look forward to working with our US and Canadian independent agents and brokers to deliver market-leading capabilities to our targeted customers. Both companies are dedicated to ensuring a seamless transition and look forward to profitably growing our specialty portfolio going forward.”

Attractive Shareholder Returns and Conservative Financing Structure

The transaction is expected to be neutral to net operating income per share in 2018 and generate mid-single digit NOIPS accretion within 24 months after close. Intact expects to also benefit from top and bottom line growth opportunities resulting from broader geographic and line of business diversification.

Intact secured the conditional purchase of a reinsurance agreement pursuant to which a major reinsurer will assume 80% of any negative development in excess of US$74 million with respect to OneBeacon’s claims liabilities as at December 31, 2016. The maximum amount payable by the major reinsurer is US$200 million and is subject to some exclusions and limitations.

Intact intends to finance the acquisition and related transaction expenses using a combination of $700 million of equity financing, approximately $700 million of excess capital and approximately $1.0 billion of financing comprised of bank term loans, medium term notes and preferred shares. Intact has hedged the purchase price against the exposure associated with USD/CAD exchange rate fluctuations. Intact will maintain its strong capital position with an estimated MCT above 200% on closing and expects its debt-to-total capital ratio to return below the target level of 20% within 24 months following the closing of the acquisition.

Intact will cancel the automatic share purchase plan announced on March 27, 2017 and suspend its normal course issuer bid in order to maintain excess capital prior to the closing date of the transaction. Following closing, Intact plans to use excess capital for deleveraging in line with its conservative transaction financing plan.

The $700 million of equity financing is being completed through a combination of a $360 million bought deal subscription receipt offering and $340 million of subscription receipts issued on a private placement basis to three Canadian institutional investors, namely Caisse de dépôt et placement du Québec, Canada Pension Plan Investment Board and Ontario Teachers’ Pension Plan (collectively, the “Private Placement Subscribers”).

In connection with the bought deal subscription receipt offering, Intact has entered into an agreement with a group of underwriters, led by CIBC Capital Markets and TD Securities Inc. for the issue of 3.9 million subscription receipts at a price of $91.85 per subscription receipt (less an underwriting fee) pursuant to a bought deal public offering in Canada and to qualified institutional buyers in accordance with Rule 144A of the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”). Each subscription receipt will entitle the holder to receive one common share of Intact upon closing of the acquisition. Intact has also granted the underwriters the option to purchase an additional 0.6 million subscription receipts exercisable at the offering price for a period of 30 days after the closing of the offering for additional gross proceeds of up to $54 million. The gross proceeds (net of the initial underwriters’ fee) from the sale of the subscription receipts will be held in escrow until the acquisition close date. The offering is expected to close on May 11, 2017.

Intact has separately agreed with the Private Placement Subscribers to issue an aggregate of 3.7 million subscription receipts at a price of $91.85 per subscription receipt (less a private placement fee). The escrow release provisions of the private placement subscription receipts are substantially equivalent to those applicable to the public offering of subscription receipts and the private placement is expected to close concurrently with the public offering.

Completion of the concurrent private placement is subject to a number of conditions including the closing of the bought deal subscription receipt offering. Completion of the bought deal subscription receipt offering is conditional upon the closing of the concurrent private placement.

The subscription receipts and the common shares of Intact have not been, and will not be, registered under the U.S. Securities Act, or the securities laws of any state of the United States and may not be offered, sold or delivered, directly or indirectly, within the United States, except in certain transactions exempt from, or not subject to, the registration requirements of the U.S. Securities Act and applicable state securities laws. This press release does not constitute an offer to sell or a solicitation of an offer to buy any of these subscription receipts within the United States.

Additional Details, Closing and Approvals

The transaction was unanimously approved by the Boards of Directors of both companies (Mr. Yves Brouillette, who is a director of Intact Financial Corporation and White Mountains Insurance Group, Ltd., the controlling shareholder of OneBeacon, was excluded from board meetings, deliberations, votes and related communications regarding the transaction). The transaction is expected to close in the fourth quarter of 2017, subject to satisfaction of customary closing conditions, including OneBeacon shareholder approval and receipt of required regulatory approvals. In connection with the entering into of the acquisition agreement, White Mountains Insurance Group, Ltd. has entered into a voting agreement pursuant to which it has agreed to vote in favour of the transaction. The voting agreement can be terminated by White Mountains Insurance Group, Ltd., if the acquisition agreement is terminated by OneBeacon. OneBeacon has the ability to terminate the acquisition agreement, subject to the procedures set forth therein and the payment of a US$85.1 million termination fee and reimbursement of Intact’s expenses up to US$22 million, in order to enter into a definitive agreement for a superior proposal with a third party.

Advisors

Goldman, Sachs & Co. LLC is acting as financial advisor to Intact Financial Corporation. Skadden, Arps, Slate, Meagher & Flom LLP and Blake, Cassels & Graydon LLP are acting as legal advisors to Intact Financial Corporation in this transaction. Davies Ward Phillips & Vineberg LLP is acting as legal advisor to the Private Placement Subscribers. McCarthy Tétrault LLP is acting as counsel to the underwriters in the bought deal subscription receipt offering.

About Intact Financial Corporation

Intact Financial Corporation (TSX:IFC) is the largest provider of property and casualty (P&C) insurance in Canada with over $8.0 billion in annual premiums. Supported by over 12,000 employees, the Company insures more than five million individuals and businesses through its insurance subsidiaries and is the largest private sector provider of P&C insurance in British Columbia, Alberta, Ontario, Québec, Nova Scotia and Newfoundland & Labrador. The Company distributes insurance under the Intact Insurance brand through a wide network of brokers, including its wholly owned subsidiary, BrokerLink, and directly to consumers through belairdirect.

About OneBeacon Insurance Group

OneBeacon Insurance Group, Ltd. is publicly traded on the New York Stock Exchange under the symbol “OB.” OneBeacon’s underwriting companies offer a range of specialty insurance products sold through independent agencies, regional and national brokers, wholesalers and managing general agencies. Each business is managed by an experienced team of specialty insurance professionals focused on a specific customer group or industry segment, and providing distinct products and tailored coverages and services. OneBeacon’s solutions target group accident and health; architects and engineers; commercial surety; entertainment; environmental; excess property; financial institutions: financial services; healthcare; management liability; ocean and inland marine; programs; public entities; technology; and tuition refund. For further information about our products and services visit: Onebeacon.com and to remain up to date on OneBeacon news, follow us on Twitter @OneBeaconIns or visit our online newsroom: www.onebeacon.com/newsroom.

CONTACT INFORMATION

  • Intact Media Inquiries:
    Stephanie Sorensen
    Director, External Communications
    +1 (416) 344-8027
    stephanie.sorensen@intact.netIntact Investor Inquiries:
    Samantha Cheung
    Vice President, Investor Relations
    +1 (416) 344-8004
    samantha.cheung@intact.netOneBeacon Media Inquiries:
    Carmen Duarte
    Director Marketing & Communications
    +1 (781) 332-7268
    cduarte@onebeacon.comOneBeacon Investor Inquiries:
    Paul McDonough
    Executive Vice-President and CFO
    +1 (952) 852-6020
    ir@onebeacon.com

Andrew Agencies Purchases Waggoner Insurance Effective May 1, 2017

News Release

May 2, 2017, Virden, MB and Winnipeg, MB – Scott Andrew, President and CEO of Andrew Agencies Ltd and Ed Waggoner, President and CEO of Waggoner Insurance are pleased to announce that Andrew Agencies has acquired Waggoner Insurance located in Winnipeg effective May 1, 2017.

The three Waggoner locations, which will be rebranded to Andrew Agencies, will be the first for Andrew Agencies in the city of Winnipeg and will increase to 19 the number of locations in its network across Manitoba, Saskatchewan and Alberta. The current Waggoner staff will remain and will be complemented with existing product specialists from Andrew Agencies.

“Andrew Agencies is excited to be entering the Winnipeg marketplace especially with having the opportunity to acquire an established well ran brokerage like Waggoner” said Scott Andrew.

“Our decision to sell to Andrew Agencies was based on what we felt was best for our staff and our loyal clients” stated Ed Waggoner.

About Andrew Agencies Ltd.

Andrew Agencies Ltd. was established in 1913 as a general insurance and travel agency in Virden, Manitoba by the Andrew family. Today, it is a busy multi-line brokerage operating in Manitoba, Saskatchewan and Alberta selling insurance and financial services.

About Waggoner Insurance

Waggoner Insurance is an insurance broker located in Winnipeg with three locations throughout the city. It is a family-owned, full service insurance brokerage that has operated independently since 1995 and is proud members of the Insurance Brokers Association of Manitoba.

Contact:

Jacy Whyte
Chief Marketing Officer
Andrew Agencies Ltd.
jacywhyte@andrewagencies.com
204.748.4813

Economical Insurance Strengthens Executive Team

Economical Insurance today announced two significant additions to the executive team. Effective May 1, 2017, Fabian Richenberger will join as Executive Vice-President (EVP), Commercial Insurance, and Kelley Irwin will join as Senior Vice-President (SVP) and Chief Information Officer (CIO). Existing executive team members Tom Reikman and Alice Keungtake on new roles as Chief Distribution Officer (CDO) and Chief Transformation Officer (CTO), respectively.

“Economical is on a path to deliver on our ambition to become one of Canada’s top property and casualty insurers,” said Rowan Saunders, President and CEO of Economical. “We are improving the alignment of our operations and leadership to facilitate growth, deepen our capabilities, and continue to meet shifting customer expectations. Fabian and Kelley will fulfill critical roles as we expand our executive team to align for future success.”

Building for greater operational scale
Responsibility for underwriting and operations is being organized across four primary areas: Broker Sales & Distribution, Personal Insurance, Commercial Insurance, and Claims.

Tom Reikman, previously SVP and Chief Operations Officer at Economical, will deepen his focus on leading broker distribution strategy across Canada as he takes on the role of Chief Distribution Officer. This reflects the company’s strong commitment to continue growing its broker business.

Fabian Richenberger joins as EVP, Commercial Insurance. He is a highly-regarded executive in Canada’s insurance sector, having previously served as President of Northbridge Insurance and most recently as Partner and Head of Financial Services for CarProof Corp. Mr. Richenberger also brings extensive international experience to Economical, beginning his more than 25-year career in his native Switzerland and spending more than 15 years with Zurich Insurance in underwriting and executive roles in Toronto, Chicago, New York, and Zurich.

“Economical has great momentum and the opportunity to help grow the commercial business is incredibly exciting,” said Richenberger. “We will work very closely with our broker partners to make sure that we deliver compelling insurance solutions and outstanding service to achieve our mutual growth aspirations.”

Leading a customer-first transformation
Mr. Saunders also announced the creation of a new Transformation & Technology function. Alice Keung, formerly Chief Information Officer (CIO) at Economical, has been appointed to lead this function, overseeing the development, delivery and execution of the Economical digital strategy, innovation and technology, as Chief Transformation Officer (CTO). Transforming key aspects of the business will drive greater efficiency and effectiveness across the enterprise and produce a superior customer, broker, and employee experience.

Kelley Irwin will join the company as its new SVP and CIO. Ms. Irwin brings extensive experience in technology for financial services, spending more than 25 years with companies such as Sun Life Financial, Symcor, and most recently TD Bank Group, as Vice President and CIO, Corporate Technology. Ms. Irwin is known for being an engaging leader of diverse teams and for her ability to drive improvement through technical solutions. She will lead IT strategy and operations as Economical continues to transform its business platforms.

“The innovation demonstrated by Economical has captured the attention of the insurance industry in the last year,” commented Irwin. “I am motivated and inspired by the opportunity to help the company continue to transform its business and think critically about future customer needs in an industry that is being challenged daily.”

About Economical Insurance
Founded in 1871, Economical is one of Canada’s leading property and casualty insurers, with $2.0 billion in premiums during 2016 and $5.4 billion in assets as at December 31, 2016. Based in Waterloo, this Canadian-owned and operated company services the insurance needs of more than one million customers across the country. Economical conducts business under the following brands: Economical Insurance, Economical, Western General, Economical Select, Perth Insurance, Sonnet, Petsecure, Economical Financial, and Family Insurance Solutions.

SOURCE Economical Insurance

Chubb Appoints Ana Robic to Chief Operating Officer, North America Personal Risk Services

Chubb has appointed Ana Robic to Chief Operating Officer, North America Personal Risk Services. In her new role, she will be responsible for strategies and activities relating to profitable growth for Chubb’s high-net-worth personal insurance division, including sales and distribution, underwriting and product strategies, underwriting centers, and risk consulting.

Ms. Robic has more than 17 years of insurance experience in commercial underwriting and management, and during the course of her career has served in a number of positions of increasing responsibilities in Canada, most recently serving as EVP, Canadian Region Manager, Commercial Insurance. She will be based in Whitehouse Station and will report to Fran O’Brien, Senior Vice President, Chubb Group, Division President, North America Personal Risk Services.

“Ana is a highly strategic leader and has deep expertise in underwriting, product distribution, service, technology and staffing that will enable us to provide innovative products and services to our high-net-worth customers, as well as support our agent and broker partners. I look forward to working with Ana in her new role,” said Ms. O’Brien.

Ms. Robic succeeds C. Scott Gunter, who, as previously announced, will serve as Senior Vice President, Chubb Group, Division President, North America Commercial Insurance.

Ms. Robic has an Honours Bachelor of Arts degree from Queen’s University (Ontario, Canada) and has executive management certificates from the University of Toronto’s Rotman School of Management and Smith College.

About Chubb
Chubb is the world’s largest publicly traded property and casualty insurance company. With operations in 54 countries, Chubb provides commercial and personal property and casualty insurance, personal accident and supplemental health insurance, reinsurance and life insurance to a diverse group of clients. As an underwriting company, we assess, assume and manage risk with insight and discipline. We service and pay our claims fairly and promptly. The company is also defined by its extensive product and service offerings, broad distribution capabilities, exceptional financial strength and local operations globally. Parent company Chubb Limited is listed on the New York Stock Exchange (NYSE: CB) and is a component of the S&P 500 index. Chubb maintains executive offices in Zurich, New York, London and other locations, and employs approximately 31,000 people worldwide. Additional information can be found at www.chubb.com.

Chubb Insurance Company of Canada has offices in Toronto, Calgary, Montreal and Vancouver and provides its products and services through licensed insurance brokers across Canada. For additional information, visit: chubb.com/ca.

SOURCE Chubb

Do you have your General Insurance Level 1 License, but not using it?

Do you have your General Insurance Level 1 License, but not using it?

So you have got your license, now what?

Do you have your General Insurance Level 1 License, but not using it? Do you know of someone looking for an excellent long-term career in the insurance industry? We have a unique fast-track 7-week personal lines insurance training opportunity starting April 17, 2017. We are looking for candidates from Victoria and the Lower Mainland area of BC, Kelowna and Kamloops. Hosted by Intact Insurance, you will receive technical, product and sales training for a successful career as a Personal Insurance Broker.

If you are a self-starter who is willing to give 100% to this fantastic program or know of someone who may be interested in applying to be a participant, please forward your cover letter and resume, along with two references, to:

dwalmsley@dlionline.ca

Only those candidates selected for an interview will be contacted.

Note: This program is only available for people not working in the insurance industry. If you are currently working for a general insurance broker, this opportunity is not an option for you at this time.

Testimonials from previous program participants:

“I believe it was a great start for me learning general insurance having no knowledge of the industry at all. The job shadowing with the underwriters helped me build a great relationship with them that whenever I give them a call and have questions and concerns it’s always pleasant and solutions are always given.” Ceazar Simon

“The ILS course was broken down in the best possible way. Very supportive staff that are dedicated to helping you achieve success. The live instruction is absolutely engaging and the instructors make it very easy to focus and learn what could otherwise be a dry subject. I have come out a great broker with a great career path ahead of me. I would recommend this course to absolutely anybody looking to get into the insurance sales industry. ” Joe Tobin

Why would I want to become a Personal Lines Insurance Broker?
Many people think working in the insurance industry is a boring 9 – 5 desk job that involves working alone in isolation under piles of paperwork.

This is not the case!

While many insurance industry roles do have an element of independence, an insurance career often calls for frequent client interaction, teamwork, networking and the opportunity for community involvement. These activities not only provide variety, they also provide a well-rounded set of skills and experience that can help you find a role or set of responsibilities that matches how you like to work. If you’re seeking a career that offers you the chance to succeed professionally while contributing something positive and necessary, becoming a personal lines insurance broker could be just the career opportunity you’ve been waiting for.

Edited by ILSTV.

BC’S TOP EMPLOYERS 2017

Do you have a climbing wall at your office?

The list of BC’s top employers has just been released, with companies like Microsoft Vancouver, the University of British Columbia, and Telus Corporation making the cut. The 12th annual list was organized by the editors of Canada’s Top 100 Employers.

According to the organzation, BC’s top employers “have made fitness and healthier lifestyle integral to their workplace.”

“Besides empowering employees to create whatever they want in terms of exercise, onsite yoga, or a biking or run club, the company provides its climbing enthusiasts with an indoor bouldering cave where they can get together over lunch to set up routes and problem-solve them,” says the release.

If your office doesn’t have an indoor climbing wall yet, you’re clearly missing out.

Source: Daily Hive

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