Arca Capital Welcomes Rejection of AmTrust Privatization Plan; Demands Offer in Excess of $22 per Share; New Record Date

PRAGUE, June 7, 2018 /PRNewswire/ -- Arca Capital, one of the largest shareholders of AmTrust Financial Services, Inc., is applauding fellow shareholders for rejecting the Zyskind/Karfunkel family's attempt to privatize the company at what it calls an absurdly low offer of $13.50 per share at the June 4th Special Meeting.

The rejection of the privatization plan comes in the aftermath of strong opposition to the deal from investors including Arca Capital and Carl Icahn backed by data from Institutional Shareholder Services illustrating substantial concerns regarding the valuation and process of the transaction. Moreover, it comes in spite of AmTrust's controversial decision to secretly set the record date for April 5, 2018 thereby denying millions of shares purchased after that date the right to vote.  It also comes in spite of allegations made in a recent statement by Carl Icahn that a member of the Zyskind/Karfunkel family, Yehuda Neuberger, appears to sit on the board of the company tasked with counting the votes.

"AmTrust Management has done everything it can possibly do to manipulate the privatization vote in its favor and yet has still failed. This vote is a clear mandate to the Zyskind/Karfunkel family that shareholders reject their insultingly low offer and demand better. This sort of behavior is not seen anywhere in the world, specifically in US. Arca Capital believes AmTrust is a fundamentally strong company with a long term price target of $25 to $31 per share. We are ready to sit down and negotiate with Barry Zyskind, George Karfunkel, Leah Karfunkel and Stone Point Capital to negotiate a fair deal in good faith with an offer in excess of $22 per share. If no deal can be reached, we are very happy for AmTrust to remain public," said Pavol Krúpa, Chairman of Arca Capital.

Krúpa supports this assessment with technical analysis: 

"Based on our valuations, the absurd $13.50 transaction price is equivalent to a 0.93x Price to Book Value Ratio (P/BV) but AmTrust should be trading at 1.8-2.2x P/BV which represents a share price of $26 to $31. This argument is supported by the Deutsche Bank initial analysis. In light of these figures, we feel like $22 per share is fair value," Mr. Krúpa added.

Arca Capital is also demanding AmTrust to change the record date in advance of any vote to allow shares to vote that were purchased between April 5, 2018 and May 21, 2018, when the original record date was publicized.

"All we are looking for is a fair offer and a fair vote for all the minority shareholders in AmTrust."

About Arca Capital

Arca Capital is a private investment group with a strong Central European exposure. It focuses on the development of its private equity activities oriented on energy, real estate, retail and service activities, as well as regulated activities focused on building and managing fund structures focusing on energy, real estate and financial services. Arca Capital also carries out projects with a so-called activist approach, with the goal of remedying and eliminating management actions that have a negative impact on companies, and with the goal of achieving significant positive change in strategy, financial structure or management. 

Assets under management over $1.7 billion USD.

Contact

Barbora Hanakova
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Mob: +420 776 575 096
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SOURCE Arca Capital