Indiana Trucking Insurer, Protective, Looking at Contingent Sale Offer

Posted on April 25, 2022

Carmel, Indiana-based Protective Insurance Corp. (Protective) reported that a special committee of independent directors has been formed to evaluate a contingent sale agreement offered by certain Protective shareholders and other parties. The offering parties were not identified.

Founded in 1930, Protective is a publicly traded holding company for several property/casualty insurance subsidiaries including Protective Insurance Co., Sagamore Insurance Co. and Protective Specialty Insurance Co. The companies provide liability and workers’ compensation coverage for trucking and public transportation fleets, along with trucking industry independent contractors.

Protective’s board of directors authorized the formation of the committee to consider the Stockholder Support and Contingent Sale Agreement (Contingent Sale Agreement) offered by prospective third-party purchasers (Offering Parties).

Protective on May 5, announced that it had received notice of the Contingent Sale Agreement on April 23, 2020, the date of filing of amendments to Schedule 13Ds relating to Protective’s Class A Common Stock.

The company said that subject to the satisfaction of certain conditions under the Contingent Sale Agreement, the Offering Parties may commence a tender offer to purchase all of the outstanding shares of Protective’s Class A Common Stock at a price per share of $18.30 per share (equal to 85% of Protective’s first quarter 2020 book value per share as reported by Protective on May 5, 2020).

The Special Committee is composed of Chair John D. Nichols, Jr., Steven J. Bensinger, Stuart D. Bilton, Otto N. Frenzel IV, David W. Michelson and James A. Porcari III.

The committee will review and consider the Contingent Sale Agreement, including the circumstances under which a tender offer may occur.

At the recommendation of the Special Committee, Protective’s board of directors have amended certain provisions of Protective’s Code of By-Laws to, among other things, provide that only the board of directors may call a special meeting of Protective’s shareholders.

Protective does not intend to comment on or disclose further developments regarding the Special Committee’s evaluation unless and until it deems further disclosure is appropriate or required.

If a tender offer is commenced, shareholders will be advised within 10 days of the Special Committee’s position regarding the tender offer.

The notice of the committee’s position will be made available to shareholders via a Schedule 14D-9 filing with the Securities and Exchange Commission (SEC).

Protective shareholders that are not party to the Contingent Sale Agreement are advised to take no action at this time, pending the review by the Special Committee of the Contingent Sale Agreement and any tender offer that may be commenced by the Offering Parties.

Skadden, Arps, Slate, Meagher & Flom LLP and Faegre Drinker Biddle & Reath LLP are serving as legal advisors to the Special Committee.

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