Tiptree Financial To Buy Fortegra For $218 Mln Cash

(RTTNews) - Tiptree Financial Inc. (TIPT) and Fortegra Financial Corp. (FRF) announced a merger agreement for Tiptree to acquire Fortegra in an all cash transaction valued at about $218 million. Both stocks surged in pre-market activity.

Shareholders of Fortegra will receive $10.00 in cash for each share, representing a premium of 42.5 percent to the closing price of Fortegra on August 11, the last trading day prior to this announcement.

The Boards of Directors of both companies, including an independent special committee of the Fortegra Board, unanimously approved the transaction.

Following the execution of the merger agreement, stockholders representing approximately 62 percent of the outstanding shares of Fortegra common stock executed a written consent adopting and approving the merger agreement.

No additional stockholder approvals are necessary to adopt the merger agreement or consummate the deal.

The merger agreement includes a 30-day "go-shop" period during which the special committee of the Fortegra Board of Directors, with the assistance of its independent financial and legal advisors, can potentially enter into negotiations with interested parties that offer alternative proposals.

Tiptree and Fortegra expect to complete the transaction in late 2014 or early 2015. There is no financing contingency.

Upon completion of the transaction, Fortegra common shares will no longer be registered with the Securities and Exchange Commission nor trade on the NYSE.

RBC Capital Markets, LLC acted as lead financial advisor and Wells Fargo Securities, LLC acted as financial advisor and lead financing arranger to Tiptree.

Willis Capital Markets & Advisory acted as financial advisor to Fortegra and rendered a fairness opinion.

TIPT settled higher by 2.4 percent on Monday at $7.22 and advanced 11.2 percent in pre-market activity.

FRF, which closed down 1.1 percent at $7.02, surged 39.7 percent on the news.