Old Republic, PMA Capital announce $365mn merger agreement

Announcing the merger, Vincent Donnelly, President and CEO, stated, "We expect that this transaction will enable our shareholders to realize greater long-term value than if we continued to operate as a stand-alone entity."

As a part of the agreement, Old Republic will takeover all of PMA's outstanding common stock. For each outstanding common share of PMA, Old Republic will be offering 0.55 shares of Old Republic common stock in exchange.

The deal values PMA at approximately $365 million, consisting of $228 million for PMA common shares and $137 million for its debt.

The merger is expected to be completed during the third quarter of 2010.

Explaining the transaction, Al Zucaro, chairman and CEO, stated, “The alliance of our two companies results in a well-capitalized insurance group appropriately positioned to take advantage of the many opportunities and synergies which will no doubt be available to us."