Citi Maintains Buy on Transatlantic Holdings

Citi is out with its report today on Transatlantic Holdings TRH, maintaining Buy, after TRH announced the signing of a definitive merger with Allied World Holdings AWH. In a note to clients, Citi writes, "The transaction is structured as a merger of equals, with shareholders of TRH receiving 0.88 AWH common shares (16% premium to Friday's close). Post-merger, TRH shareholders will own ~58% of the combined company on a fully diluted basis and AWH shareholders will own ~42%. The combined company will have $8.5B of capital, total invested assets of $21B and total shareholders' equity of ~$7B. Deal is expected to close in 4Q11." Citi maintains a $60 PT on TRH. At the time of posting, shares of TRH were trading pre-market at $52.00, up 18.15% from Friday's close.