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News > International
Fortis snatches $2.6B ABI
March 8, 1999: 4:15 a.m. ET

Dutch insurer acquires American Bankers Insurance, stock surges
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LONDON (CNNfn) - Dutch insurance and banking company Fortis announced Monday that it has acquired American Bankers Insurance Group (ABI), a leading U.S. credit-related insurer for $2.6bn.
     Under the agreement, Fortis will pay $55 in cash for each ABI ordinary share, a 19 percent premium over Friday's closing price. It will also assume $194 million of ABI's outstanding debt.
     By combining ABI with American Security Group, Fortis' Atlanta-based credit insurance subsidiary, the deal creates a leading U.S. specialized insurer with annual gross premiums of $3.6 billion.
     ABI has been the target of several takeover bids in the past year. Both American Insurance Group (AIG) and marketing group Cendant (CD) were pitted against one another to take over the Miami-based company. Cendant eventually acquired ABI for $3.1bn last March. But the planned merger was canceled seven months later as Cendant came under pressure to retire outstanding debt.
     Fortis shares jumped on the news. In early-morning trade they rose almost 3 percent to 35.60 euros in Amsterdam. Back to top

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