Maiden Holdings and Kestrel Group have agreed to a merger that will help create a new listed specialty program group.
Under the agreed terms, Maiden’s common shares will be converted into the right to secure shares in a new Bermuda-based entity, which will acquire both Maiden and Kestrel.
This deal values Kestrel up to $167.5 million, consisting of $40 million in cash, 55 million common shares of the new company valued at $82.5 million, and an earnout of up to $45 million payable in common shares.
The merged company will operate under the name Kestrel Group and its shares will be listed on Nasdaq.
The leadership team for the merged group will include Luke Ledbetter as CEO, Terry Ledbetter as executive chairman and Pat Haveron as president and CFO.
Following the merger, Kestrel will continue to operate through AM Best A-FSC XV insurers, subsidiaries of AmTrust Financial Services.
In addition, the combined company will have the option to acquire these insurers from AmTrust.
The new entity’s board of directors will consist of seven members, four of which will be selected by a subsidiary of the Ledbetters, including two independents, and three selected by AmTrust, including two independents.
Completion of the deal is expected in the first half of 2025, subject to various conditions, including Maiden shareholder approval, expiration of the Hart-Scott-Rodino Antitrust Improvements Act waiting period, approval for a Nasdaq listing and other regulatory approvals.
Insurance Advisory Partners is Maiden’s financial advisor on the deal, with Paul, Weiss, Rifkind, Wharton & Garrison providing legal advice.
Appleby advises the disinterested members of Maiden’s Board. Kestrel will receive financial advice from Evercore, while Skadden, Arps, Slate, Meagher & Flom will handle legal matters.
Maiden CEO and CFO Pat Haveron said: “The Ledbetters and the wider Kestrel team have a long and proven track record of success in the specialty programs market, and we look forward to working with them to deliver value to be supplied to program managers, MGAs, reinsurers and companies. reinsurance brokers in a range of attractive specialist lines.”
Kestrel President and CEO Luke Ledbetter stated, “The combination with Maiden will allow us to accelerate our growth plan and take advantage of favorable market tailwinds as we continue our efforts to become the leading specialty program group in the United States.”
“Maiden, Kestrel to Merge as Publicly Traded Specialty Program Group” was originally created and published by Life Insurance International, a brand owned by GlobalData.
