OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has commented that the Credit Ratings (ratings) of American International Group, Inc. (AIG) (headquartered in New York, NY) [NYSE: AIG] and its subsidiaries remain unchanged following the Jan. 22, 2018 announcement that AIG has signed a definitive agreement to acquire all outstanding common shares of Validus Holdings, Ltd. (Validus) [NYSE: VR].
Under the terms of the agreement, holders of Validus common shares will receive cash consideration of $68.00 per share, for an aggregate transaction value of $5.56 billion, funded by cash on hand. The transaction affords AIG the benefits of business diversification and a seasoned management team, while being immediately accretive to earnings and maintaining AIG’s financial leverage within acceptable levels for its ratings.
Given the lack of business overlap and general modest size of Validus, this transaction should not result in material execution risk or distraction to AIG as it works to improve the performance of its property/casualty business.
The transaction is expected to close mid-2018, subject to approval by Validus shareholders and other customary closing conditions, including regulatory approvals in relevant jurisdictions and the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
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