Markel has agreed to acquire SureTec for nearly $250m, inclusive of a three-year earn out.
The transaction is subject to customary closing conditions, including insurance regulatory approvals, and is expected to close in the first half of 2017.
Following the acquisition, SureTec will operate as a separate business unit, with John T. Knox, Jr., SureTec's current Chairman and Chief Executive Officer, leading his seasoned team in his current capacity. The operating unit will become part of Markel's Specialty division and US Insurance segment.
Markel Co-CEO Richard R. Whitt said: "We are very excited to have John and the SureTec team join Markel. Since its start in 2002, SureTec has grown its surety business prudently and profitably with a diversified product and geographic mix.
“It has become a top 20 player in the surety market nationwide through its offerings of contract, commercial, and court bonds. As with all our acquisitions, we look forward to exploring opportunities to profitably grow the business."
SureTec chairman and CEO John T. Knox, Jr. said: "We could not be happier to be joining Markel. I look forward to leading what will become Markel Surety and building upon SureTec's success while benefiting from Markel's financial strength and (re)insurance capabilities, which will position us to better serve our customers and grow our business."
TigerRisk Capital Markets & Advisory served as financial advisor and Sidley Austin served as legal advisor to Markel. Locke Lord served as legal advisor to SureTec.