Markel Plans To Buy State National Companies For $919M

Markel Corp., a Henrico County-based specialty insurance company, is planning to buy a Texas-based insurance firm in a cash deal valued at $919 million.

Markel, one of the Richmond area's eight Fortune 500 companies, said Wednesday that it has agreed to pay $21 per share for all of the outstanding shares of State National Companies Inc., a seller of property and casualty insurance.

The deal must get approval from State National's shareholders and state insurance regulators, although two large blocks of shareholders are in favor of the deal.

Markel expects to close the deal in the fourth quarter.

If approved, the deal would be among Markel's largest acquisitions. Its $3.13 billion acquisition in 2013 of Alterra Capital Holdings, a Bermuda-based reinsurance company, was the largest deal in the company's history.

The acquisition gives Markel a platform in several businesses where it does not have a presence now. For instance, State National has an insurance fronting business, with about $1.3 billion in gross written premiums in 2016.

The company also is the leading provider of collateral protection insurance, which insures property held as collateral for loans.

State National has about 450 employee, and the acquisition is not expected to result in job losses.

Markel plans to pay for the State National acquisition using cash balances on hand.