PRA Agrees To Buy AMPH; Shares Climb

ProAssurance Corp PRA announced on Wednesday its plans to acquire American Physicians Service Group AMPH for about $233 million in cash. The acquisition would expand the property and casualty insurer’s presence in Texas. PRA has agreed to pay $32.50 a share for its smaller rival. The price represents a 24% premium to AMPH’s closing price on Tuesday. ProAssurance’s CEO Stancil Starnes said in a statement, “APS is the second largest writer of medical professional liability (MPL) insurance in Texas, so we expect this transaction to give ProAssurance a strong market presence.” The Birmingham, Alabama-based company stated that it would fund the transaction with cash on hand, adding that there is no financing condition needed to complete the deal. PRA said the acquisition will be accretive to its 2011 earnings, before one-time charges. Austin, Texas-based American Physicians Service's shares jumped to a record high of $32.25 on Wednesday morning. Shares of ProAssurance rose around 4% following the announcement. Read more from Benzinga's Company news.