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Allstate To Buy National General For $4 Bln In Cash

Allstate Corp. (ALL) said that it agreed to acquire National General Holdings Corp. (NGHC) for about $4 billion in cash or $34.50 per share.

Allstate expects to close the transaction in early 2021, and expects the deal to be accretive to adjusted net income earnings per share and return on equity beginning in the first year.

As per the deal, National General shareholders will receive $32.00 per share in cash, plus closing dividends expected to be $2.50 per share, providing $34.50 in total value per share.

Allstate said it will fund the share purchase by deploying $2.2 billion in combined cash resources and, issuing $1.5 billion of new senior debt. Allstate expects to maintain its current share repurchase program.

National General's board has approved the transaction, which includes customary terms and conditions, including a breakup fee of $132.5 million. A voting agreement has also been signed with entities controlling 40% of National General's common shares to vote for the transaction.

MSD Capital, which owns about 7.4% of National General's outstanding common shares, also supports the transaction, Allstate said.

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