Intact Financial Corp to buy U.S based OneBeacon for $1.7 billion

Intact Financial Corp, Canada's biggest property and casualty insurer, said it would buy U.S.-based specialty insurer OneBeacon Insurance Group Ltd for $1.7 billion, creating a specialty insurer focused on small- and mid-sized businesses. Shares of OneBeacon were trading at the offer price in after-hours trading following the announcement. The deal will create an insurer with over $1.46 billion of annual premiums. Intact said it plans to finance the deal and related expenses using a combination of equity financing, some excess capital and financing consisting of loans, notes and preferred shares. OneBeacon's debt of about $275 million will remain outstanding, Intact said. Goldman Sachs is the financial adviser for Intact, while Credit Suisse advised OneBeacon.