valuesource Posted June 22, 2017 Share Posted June 22, 2017 Apparently, they are just waiting for Delaware. Link to comment Share on other sites More sharing options...
nwoodman Posted June 22, 2017 Share Posted June 22, 2017 Apparently, they are just waiting for Delaware. Thanks, for the update. Do you have a reference for the other jurisdictions mentioned? Arkansas Approval http://www.insurance.arkansas.gov/news/2017/jun/19/kerr-approves-1b-acquisition/ New Hampshire Approval http://www.nh.gov/insurance/legal/documents/order_alliedworldacquisition06.22.17.pdf OMERS - not related to the above https://www.nh.gov/insurance/legal/documents/nh_forma_omers_alliedwld.pdf Looks like the Delaware hearing is scheduled for next Tuesday http://insurance.delaware.gov/wp-content/uploads/sites/15/2017/05/public-hearing-regarding-individual-licensee-fairfax-UPDATED.pdf Cheers nwoodman Link to comment Share on other sites More sharing options...
valuesource Posted June 23, 2017 Share Posted June 23, 2017 Cannot site a source. Link to comment Share on other sites More sharing options...
nwoodman Posted June 23, 2017 Share Posted June 23, 2017 Nice summary and worth a read Fairfax Financial’s Evolution to Global Player http://www.economicswire.net/fairfax-financials-evolution-to-global-player.html Link to comment Share on other sites More sharing options...
nwoodman Posted July 6, 2017 Share Posted July 6, 2017 Closed http://www.fairfax.ca/news/press-releases/press-release-details/2017/Fairfax-Financial-Successfully-Completes-Acquisition-of-Allied-World-and-Closes-Exchange-Offer/default.aspx Link to comment Share on other sites More sharing options...
obtuse_investor Posted July 6, 2017 Share Posted July 6, 2017 Any disclosures or estimates on the pro-forma book value now that the deal is closed? Link to comment Share on other sites More sharing options...
gary17 Posted July 6, 2017 Share Posted July 6, 2017 i get roughly $ 338 USD or $ 436 CAD per share. total equity from Q1 of the two companies = 12B less the special dividend and cash payout to existing AWH holders ... equity left is about $9.5B fairfax closing price is about $444 usd so the ratio is 0.027 + the fix ratio .030392 = about 5M new FFH shares being issued Q1 outstanding shares = 23M so now 28M share out $9.5B / 28M shares = $338 usd/share for book value. That's interesting earlier this year fairfax was trading about 1.25 xbook & the $52 buyout is also about 1.25book right now it's trading around 1.3 book 30% premium just as a perspective, I looked at AWH a few years ago when it was trading at a discount to book. It wanted to buy Transatlantic and BRK came in with a similar offer too - interesting back then these were 0.7 ~ 0.8 to book. It's been great for AWH shareholders to see growth in book value and an increase on valuation http://www.reuters.com/article/us-alliedworld-idUSTRE78F1V120110916 Link to comment Share on other sites More sharing options...
racemize Posted July 6, 2017 Share Posted July 6, 2017 Are you sure on that BVPS? The previous value was $361 and they are issuing shares above book value, so I would not expect it to go down. Link to comment Share on other sites More sharing options...
gary17 Posted July 6, 2017 Share Posted July 6, 2017 they are issuing shares based on the formula according to the presentation updated in March http://s1.q4cdn.com/579586326/files/doc_downloads/2017/2017_03-Investor-Presentation.pdf Fixed exchange ratio of 0.030392 shares of Fairfax per Allied World share (~$14.00 per Allied World share) Floating exchange ratio representing a fixed value of $12.00 per Allied World share between Fairfax share prices of US$435.65 and US$485.65 per share; fixed exchange ratios of 0.027545 below US$435.65 and 0.024709 above US$485.65 Since on July 5 FFH closing was $444 usd that's floating ratio of $ 12 / 444 = 0.027027 So 0.027027 + 0.030392 = .057419 AWH had about 86M shares out so * 0.057419 = 5M new shares of FFH after conversion 23M + 5M = 28M shares Link to comment Share on other sites More sharing options...
A_Hamilton Posted July 6, 2017 Share Posted July 6, 2017 they are issuing shares based on the formula according to the presentation updated in March http://s1.q4cdn.com/579586326/files/doc_downloads/2017/2017_03-Investor-Presentation.pdf Fixed exchange ratio of 0.030392 shares of Fairfax per Allied World share (~$14.00 per Allied World share) Floating exchange ratio representing a fixed value of $12.00 per Allied World share between Fairfax share prices of US$435.65 and US$485.65 per share; fixed exchange ratios of 0.027545 below US$435.65 and 0.024709 above US$485.65 Since on July 5 FFH closing was $444 usd that's floating ratio of $ 12 / 444 = 0.027027 So 0.027027 + 0.030392 = .057419 AWH had about 86M shares out so * 0.057419 = 5M new shares of FFH after conversion 23M + 5M = 28M shares Gary, They provided the final ratio in the press release below. http://www.fairfax.ca/news/press-releases/press-release-details/2017/Fairfax-and-Allied-World-Announce-Final-Exchange-Ratio-for-Exchange-Offer/default.aspx Link to comment Share on other sites More sharing options...
gary17 Posted July 6, 2017 Share Posted July 6, 2017 they are issuing shares based on the formula according to the presentation updated in March http://s1.q4cdn.com/579586326/files/doc_downloads/2017/2017_03-Investor-Presentation.pdf Fixed exchange ratio of 0.030392 shares of Fairfax per Allied World share (~$14.00 per Allied World share) Floating exchange ratio representing a fixed value of $12.00 per Allied World share between Fairfax share prices of US$435.65 and US$485.65 per share; fixed exchange ratios of 0.027545 below US$435.65 and 0.024709 above US$485.65 Since on July 5 FFH closing was $444 usd that's floating ratio of $ 12 / 444 = 0.027027 So 0.027027 + 0.030392 = .057419 AWH had about 86M shares out so * 0.057419 = 5M new shares of FFH after conversion 23M + 5M = 28M shares Gary, They provided the final ratio in the press release below. http://www.fairfax.ca/news/press-releases/press-release-details/2017/Fairfax-and-Allied-World-Announce-Final-Exchange-Ratio-for-Exchange-Offer/default.aspx ' LOL i didn't see. i'm not far off - if anything with their final ratio there's even lower bvps Link to comment Share on other sites More sharing options...
gokou3 Posted July 6, 2017 Share Posted July 6, 2017 Company estimated the new BVPS = US$384.98 per page 21 of the attached March 24th presentation. Any major change since then?2017_03-Investor-Presentation.pdf Link to comment Share on other sites More sharing options...
racemize Posted July 6, 2017 Share Posted July 6, 2017 So I just did the math and got a similar number to what Gary did, but I think it is missing some accounting minutia (if anyone can jump in on that, I would appreciate the explanation), so I don't think the new book value will be $338. If you apply the same math to the presentation Goku just posted, you would have gotten $342; instead, presentation lists total equity value of $10,855 rather than $9,587. I imagine this has to do with some combination of 1) issuing shares above book value as FFH is doing should increase book value per share; 2) there are a lot of minority shareholders that will own a portion of Allied, and they are pitching in money that isn't coming out of FFH balance sheet; and 3) other accounting rules. Anyway, if you use their reported total equity value from the presentation (and I think it should be close, given the small changes from end to Q1 of the two companies) and the new number of shares (which is higher than when the presentation was provided), you get pro forma book value of $385. Would really appreciate any people with know-how on this to help correct the math/process for getting the value. TIA. Link to comment Share on other sites More sharing options...
racemize Posted July 6, 2017 Share Posted July 6, 2017 I'm obviously still sick--all these calculations are tangible ones that exclude goodwill that will be added to FFH asset side. Still not sure how to go through all the calculations to figure this out by hand, if that is possible from the information we have. Link to comment Share on other sites More sharing options...
gary17 Posted July 6, 2017 Share Posted July 6, 2017 why should AWH have any good will I guess if people want to value it that way OK... LOL it all comes down to how many times book Link to comment Share on other sites More sharing options...
benhacker Posted July 6, 2017 Share Posted July 6, 2017 Race, be sure you are counting "common" book, you can't include preferred equity (or if you do, the number means something else). Link to comment Share on other sites More sharing options...
racemize Posted July 6, 2017 Share Posted July 6, 2017 My numbers came in low, the same way Gary's did. I believe the reason is because neither of us included any goodwill for the acquisition on the books. Anyway, the FFH presentation is the one with the higher common equity and projected book value per share, so I don't think there's any preferred equity in there. I believe my updated value just adjusts their calculation slightly, so it should treat it the way FFH did in the first place. Edit: Oh, I see, I used the word "total" in my post--the presentation says "common equity" and then also says BVPS is ~$385. Sorry my language wasn't too clear there. Link to comment Share on other sites More sharing options...
nwoodman Posted July 14, 2017 Share Posted July 14, 2017 FWIW revised ratings on Allied World post merger Moody's https://www.moodys.com/research/Moodys-downgrades-Allied-Worlds-ratings-following-acquisition-by-Fairfax-outlook--PR_368998 S&P http://www.intelligentinsurer.com/news/s-p-cuts-allied-world-post-acquisition-by-fairfax-12487 Link to comment Share on other sites More sharing options...
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