Markel Corporation and Alterra Capital Holdings Limited have agreed on a definitive merger agreement. As per the agreement, the aggregate consideration for Alterra is approximately USD 3.13 billion, based on a closing price of USD 486.05 for Markel common stock on December 18, 2012. Upon the merger, Markel's existing shareholders will own approximately 69 percent of the combined company on a fully diluted basis, with Alterra's shareholders owning approximately 31 percent. Completion of the transaction is contingent upon customary closing conditions, including shareholder and regulatory approvals, and it is expected to close in the first half of 2013.

Steven A. Markel, vice chairman of Markel, said, “We are very pleased to have reached this agreement to acquire Alterra, an impressive company with proven worldwide underwriting operations in product lines that we believe are highly complementary to Markel's existing lines. In particular, the addition of Alterra's reinsurance and large account insurance portfolios will serve to diversify and strengthen Markel's current book of specialty insurance business. We look forward to welcoming Alterra's talented underwriting teams to Markel - with their help and the benefit of approximately USD 6 billion in combined shareholders' equity, we believe we will be well positioned to take advantage of a wide range of profitable opportunities.”

W. Marston (Marty) Becker, president and CEO of Alterra, said, “The combination of Alterra with Markel will create an incredibly strong company in global specialty insurance and investments. The demonstrated track record of underwriting discipline in niche market segments by both companies, along with Markel's proven asset management strengths, should benefit all stakeholders. I am confident that Alterra's shareholders, clients and other business partners will continue to be well served when Alterra's underwriting operations join forces with Markel's, and all should benefit from the superior financial strength, expanded capabilities and synergies created by the combined entity.”

At closing, each Alterra common share will be converted into the right to receive 0.04315 Markel common shares (with cash paid for fractional shares) plus a cash payment of USD 10. Upon closing, two directors designated by Alterra's current board will be added to the board of directors of Markel.

Recently, Alterra Capital Holdings Limited was in news for making several key promotions affecting its US operations. Stephen (Steve) J. Vaccaro Jr., formerly CEO of Alterra Specialty, has been promoted to chairman of Alterra's US Insurance operations; Douglas (Doug) M. Worman, CEO of Alterra USA, takes on the additional role of CEO of Alterra's US Insurance operations; and Bryan W. Sanders, formerly COO of Alterra Specialty, has been promoted to CEO of Alterra Specialty. Alterra's US Insurance operations include Alterra Specialty and Alterra USA, which are primarily wholesale and retail focused, respectively.

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