Standard Diversified to acquire Tri-State Consumer Insurance for approx. $54.1M
Standard Diversified announced that it has entered into a Stock Purchase Agreement to acquire the holding company of Tri-State Consumer Insurance from WT Holdings, Inc. and its affiliates, for approximately $54.1M. This transaction provides significant economies of scale and operating synergies via the integration of Tri-State with SDI's existing insurance subsidiary, Maidstone Insurance Company. Closing of the transaction shall be subject to final approval by the New York State Department of Financial Services. Tri-State is a New York State based, A.M. Best A- rated, admitted carrier offering homeowners and personal auto insurance in New York. At September 30, 2018 Tri-State had net admitted assets of $105.4M and statutory surplus of $44.4M. The transaction purchase price of approximately $54.1M, consists of $25M in Series A Convertible Redeemable Preferred Stock, with the remainder to be paid in cash at closing, subject to statutory surplus adjustments and claims resolutions. In addition to the diligence that was performed prior to entering into the Agreement, SDI will have seventy-five days to conduct additional due diligence with the assistance of third party underwriting, financial and tax consultants. SDI has a right to terminate the Agreement in its sole discretion prior to the end of this seventy-five day period. The Company has also filed a Form 8-K with the Securities and Exchange Commission, further detailing the terms and conditions of the Agreement. The Company was represented by Nixon Peabody LLP and Morgan, Lewis & Bockius.