Fairfax Financial Holdings Limited (FFH) Strikes Deal To Acquire Pethealth Inc. (PTZ)

Fairfax Financial Holdings Limited (TSX:FFH), a financial services holding company led by Prem Watsa, has agreed to acquire Pethealth Inc. (TSE:PTZ).

In a recent Form 6-K filed the U.S. Securities and Exchange Commission, Fairfax Financial Holdings Limited (TSX:FFH) said that it will acquire all of the outstanding preferred shares of Pethealth Inc. (TSE:PTZ) for a purchase price of $2.79 per share in cash, plus any dividends accrued but unpaid up to, but excluding, the day of closing.

Prem Watsa

The purchase price represents a premium of about 26% to the closing price of Pethealth Inc. (TSE:PTZ) common shares on the Toronto Stock Exchange (TSX) on August 29, and a premium of approximately 69% to the closing price of the company’s common shares on the TSX on August 15. It also represents a premium of approximately 69% to the company’s volume weighted average share price for the twenty trading days ending on August 15, 2014, and a premium of 36% to the all-time high price of the company’s common shares prior to such date.

Pethealth Inc. (TSE:PTZ) is North America’s second largest provider of medical insurance for dogs and cats to pet owners, operating in the United States, Canada and the United Kingdom. The company will receive a total cash consideration of about $100 million for its common and preferred shares and options.

The transaction, to be completed by way of a plan of arrangement, is subject to certain customary closing conditions, and is expected to close in the fourth quarter of 2014.

Pethealth Inc.’s (TSE:PTZ) board of directors recommended shareholders to vote in favour of the arrangement. However, Mark Warren, president, chief executive officer (CEO) and a director of Pethealth Inc. (TSE:PTZ), voted against the approval of the transaction. Warren owns approximately 9.7% of the outstanding common shares.

“Certain shareholders of [Pethealth Inc. (TSE:PTZ)], including certain directors, who in the aggregate beneficially own approximately 14.5% of the outstanding common shares and 40.4% of the outstanding preferred shares, have agreed pursuant to voting support agreements to vote their shares in favour of the arrangement unless the arrangement agreement is terminated,” according to the release.

The deal is subject to customary closing conditions, including court approval of the arrangement, the approval of the Pethealth Inc.’s (TSE:PTZ) shareholders voting as a single class, and regulatory approval in the United Kingdom.

Pethealth Inc. (TSE:PTZ) is expected to hold shareholder meeting in November 2014.

Disclosure: none

Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

The 10 Most Peaceful Countries in the World

5 Big Reasons Communism Failed

The 15 Most Famous Carl Icahn Quotes

10 Scary Animals that are Actually Harmless

The 8 Most Famous Singer-Actors in Entertainment

The 10 Longest Wars of All Time

The 13 Worst Looking Foods that Taste Great

The 6 Most Gruesome Injuries Suffered During a Sports Match

The 20 Biggest Contracts in MLB History

The 7 Worst Blown Calls in Sports History

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!