Chicago-based insurance broker Hub International Limited reported that the agreement under which it is being bought by funds advised by Apax Partners together with Morgan Stanley Principal Investments has been amended to, among other things, increase the consideration to be received by Hub’s shareholders to $41.50 in cash per common share from $40.00. The increase in consideration followed receipt by Hub of competing proposals.
In the event the amended agreement is terminated under specified circumstances, Hub will be obligated to pay a break-up fee of 3 percent of the equity value of the transaction ($53 million).
The amendments have been unanimously approved by Hub’s board of directors following the unanimous recommendation of a special committee comprised of disinterested directors, which was formed to, among other things, evaluate the terms of the transaction.
As previously disclosed, the transaction is expected to be completed toward the end of the second quarter of 2007 and is subject to shareholder approval, Canadian court approval, and other regulatory approvals including merger notification filings in the United States and Canada, as well as customary closing conditions. Morgan Stanley and Merrill Lynch & Co. have provided commitments for the debt portion of the financing for the transaction.
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