Intact Financial Corporation to Acquire US Specialty Insurer OneBeacon Insurance Group, Ltd. for US $1.7 billion

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

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• 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.