Insurance Management Solutions Group Inc. (INMG.OB), a St. Petersburg, Fla.-based provider of business process outsourcing solutions serving insurance companies and financial institutions, announced it has been contacted by a third party potentially interested in acquiring the company or its business. As a result, the company is delaying its previously announced intent to commence a cash tender offer for all presently outstanding publicly-held shares of its common stock.
INMG.OB determined that it is appropriate to further investigate the possible acquisition possibility prior to proceeding with the cash tender offering of $0.01 per share of common stock, at a price of $3.08 per share, net to the seller in cash. The offer would be conditioned upon at least a majority of the shares of common stock not held by two subsidiaries of Bankers Insurance Group Inc. (BIG), Bankers Insurance Company (BIC) and Bankers Security Insurance Company (BSIC) and, collectively with BIG and BIC, the “BIG Group”, being tendered and other closing conditions typical for this type of transaction.
The company gave no assurances as to whether discussions with the third party will result in a potential offer for the company or its business or, if so, upon what terms and conditions.
As part of its evaluation of the potential third-party transaction, the company also intends to further consider the implications of BIG’s recently announced agreement with Fidelity National Financial Inc. (FNF), pursuant to which FNF is to acquire First Community Insurance Company, another subsidiary of BIG and a fifty-state licensed insurance carrier (FCIC), and certain assets of BIG, including the rights to issue new and renewal flood insurance policies underwritten by the BIG Group.
The closing of such transaction is subject to certain regulatory approvals and other conditions, including certain revisions to the existing Insurance Administration Services Agreement between the company and BIG (including certain of its subsidiaries). The company will continue to provide flood policy administration and claim services to FNF upon the closing of such transaction.
The company has decided to undertake further due diligence to confirm its previous conclusion as to the fairness of the proposed offer. Financial advisors Houlihan, Lokey, Howard & Zukin were directed to review the fairness, from a financial point of view, of the offer price to the company’s shareholders (other than the BIG Group).
INMG.OB also announced that three alleged shareholders of the company, each on behalf of a putative class consisting of the company’s current public shareholders, have filed lawsuits against, among others, INMG.OB and the company’s current directors challenging the proposed offer.
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