Insurers Max Capital and Harbor Point to merge creating Alterra Capital

Insurers Max Capital, Harbor Point to merge

Insurers Max Capital Group Ltd. and Harbor Point Ltd. said Wednesday they plan to merge, creating a new company to be called Alterra Capital Holdings Ltd.

Max Capital is a Bermuda-based insurance and reinsurance company and Harbor Point is a privately held property and casualty reinsurance company with operations in Bermuda, the United States and the United Kingdom.

Holders of Harbor Point common stock will receive 3.7769 Max common shares for each Harbor Point share owned.

Closing is expected in the second quarter of this year.

Shareholders must approve the merger, which is contingent upon customary closing conditions and regulatory approvals.

The combined company is expected to declare a special cash dividend of $2.50 per share following closing to all shareholders of the combined company, an amount expected to total about $300 million.

Harbor Point shareholders will own about 52 percent of the combined company and Max shareholders, 48 percent.

Max Capital’s CEO W. Marston (Marty) Becker will be president and CEO of Alterra and serve as a director.

Harbor Point CEO John R. Berger will be chief executive of Reinsurance of Alterra and vice chairman of the board of directors. He also will chair the board’s underwriting committee.

Alterra’s board will consist of 14 directors including Becker and Berger. Each merger partner will appoint six directors.

The chairman of Harbor Point’s board, Michael O’Reilly, will be the non-executive chairman of Alterra’s board.

After the deal closes, the combined company will trade on the NASDAQ Global Select market under the ticker symbol ALTE. It will be based in Bermuda.

Reinsurance will be written by Alterra Reinsurance Limited and Alterra Reinsurance USA Inc., formerly the Harbor Point reinsurance companies.

Max Capital shares rose 35 cents, or 1.5 percent, to close at $24.27. Shares lost 9 cents in aftermarket trading. They’ve traded between $13 and $24.81 in the past 52 weeks.