Benzinga | Nov 9, 2021 06:29PM EST

Independence Holding Company Announces Co. Will Be Acquired By Geneve Holdings For $57/Share

Independence Holding Company (NYSE:IHC) (the "Company") today announced that it has entered into a definitive Agreement and Plan of Merger (the "Merger Agreement") to be acquired by Geneve Holdings, Inc. (the "Going Private Transaction").

Under the terms of the Merger Agreement, holders of the Company's outstanding shares of common stock, excluding shares held by Geneve Holdings, Inc. and its wholly owned subsidiaries (collectively, "Geneve"), will receive $57.00 per share in cash. The $57.00 per share price represents a premium of 35.7% over $42.01 per share, the trading price for common stock on August 27, 2021, the trading date immediately preceding the date on which Geneve initially proposed to acquire the Company, and a premium of 15.2% over the closing trading price of $49.50 on November 8, 2021. The Going Private Transaction will be financed in part through the proceeds from the sale of certain of the Company's subsidiaries, Independence American Holdings Corp. and Standard Security Life Insurance Company of New York, which are anticipated to close prior to year-end 2021.

The Company's Board of Directors (the "Board") formed a special committee of directors consisting solely of independent directors (the "Special Committee") after Geneve proposed a possible Going Private Transaction in August 2021. Geneve's proposal was expressly contingent upon any transaction being considered, negotiated and approved by a Special Committee and being subject to approval by the holders of a majority of the shares not owned by Geneve and its affiliates (the "Majority of the Minority"). The Special Committee was charged by the Board with conducting a process intended to examine Geneve's proposal and determine whether the Going Private Transaction was the best option for the Company's stockholders other than Geneve (the "Minority Stockholders"), and, if so, to negotiate its terms. The Special Committee, with the assistance of independent financial and legal advisors, conducted a review of the proposal, and after consideration of the various alternatives available to the Company, including remaining a public company, determined that a proposed Going Private Transaction at an acceptable price would be the best option for the Minority Stockholders, and following this determination, negotiated the price and other transaction terms with Geneve. The Special Committee concluded unanimously that the Going Private Transaction on the terms it negotiated was fair and in the best interests of the Minority Stockholders. Based on the unanimous recommendation of the Special Committee, the Merger Agreement was also approved by all of the Board members voting on the Merger Agreement. Directors of the Company who are also directors or officers of Geneve did not participate in the deliberations of the Special Committee and recused themselves from the vote of the Board.

Roy T.K. Thung, the Company's Chief Executive Officer, said, "I would like to thank the Special Committee who worked hard and independently on the Going Private Transaction with their financial and legal advisors since August 2021 to negotiate a fair deal resulting in a positive result for all parties and which I believe is in the best interest of the Minority Shareholders."

Completion of the Going Private Transaction is subject to certain closing conditions, including obtaining approval by the Majority of the Minority, the consummation of the pending sales of the Company's subsidiaries, Independence American Holdings Corp. and Standard Security Life Insurance Company of New York, and other customary conditions. The Company will continue to declare and pay regular dividends, consistent with past practice, through the closing of the Going Private Transaction. Further information regarding the terms and conditions in the Merger Agreement will be contained in a Current Report on Form 8-K which will be filed promptly with the SEC.

Perella Weinberg Partners LP is acting as financial advisor, and Paul, Weiss, Rifkind, Wharton & Garrison LLP is acting as legal advisor, to the Special Committee. Dentons US LLP is acting as legal advisor to the Company and Davies Ward Phillips & Vineberg LLP is acting as legal advisor to Geneve.