State National Companies Inc. said Wednesday it agreed to be acquired by Markel Corp. in a deal that values the property and casualty insurer at about $885.6 million. Under terms of the deal, Markel will pay $21 in cash for each State National share outstanding, which is 6.8% above Tuesday's closing price of $19.67. The deal is expected to close in the fourth quarter of 2017, after which State National will operate as a separate business unit. "We believe this transaction with Markel is good for our employees and clients, as well as our shareholders," said State National chief executive Terry Ledbetter. "This transaction is all about growth, not cost-cutting, and we believe that State National employees will benefit from being part of a larger, stronger, growth-oriented company with a more diversified platform." State National's stock rose 6% in premarket trade. It has soared 42% year to date through Tuesday, while Markel's stock has climbed 14% and the S&P 500 has gained 11%.
Continue Reading Below
Copyright © 2017 MarketWatch, Inc.