Commercial insurer ACE Limited has agreed to acquire Pennsylvania-based Penn Millers Holding for $107m in cash to enhance its presence in the US agricultural insurance market.
Penn Millers Insurance Company operates in 34 US states and provides insurance through subsidiary Penn Millers to companies that manufacture, process and distribute agricultural products.
ACE chairman Brian Dowd said that the acquisition of Penn Millers will provide ACE with an established, specialty niche business that complements current agricultural market capabilities offered through Rain and Hail crop insurance and ACE Westchester excess and surplus lines businesses.
"The addition of Penn Millers to the ACE Group will produce results that are immediately accretive to our earnings, return on equity and book value per share," Dowd said.
The transaction, which is subject to regulatory approvals, PMHC shareholder approval and other customary closing conditions, is expected to be completed by the end of the first quarter of 2012.