Bermuda-based Enstar Group Ltd has agreed a deal to acquire US insurer SeaBright Holdings, Inc for around $252 million.Enstar will pay $11.11 per share in cash. The purchase price represents a 34.3 percent premium over SeaBright’s closing stock price on Monday of $8.27. The deal is expected to be completed in the first quarter of 2013.The deal was announced late on Monday and SeaBright’s shares surged 32 percent yesterday to just shy of the Enstar offer price. Enstar shares closed virtually unchanged at $94.69 yesterday.Enstar, which is based in offices on Queen Street, acquires and manages insurance and reinsurance companies in run-off. SeaBright has been offering workers’ compensation insurance for 25 years.Seattle-based SeaBright was once the Eagle Pacific Insurance division of Services Group of America. It floated on the stock market in January 2005 at $10.50 a share and the price peaked in mid-2007 at $19.74.SeaBright’s balance sheet shows assets of nearly $1.1 billion. The company bounced back from net losses in 2010 and 2011 by posting a $9.5 million profit for the first six months of this year.Enstar is the world’s biggest company solely dedicated to run-off business. SeaBright is the latest in a succession of acquisitions that helped the company build up total assets of more than $6 billion and shareholders’ equity of $1.42 billion by the end of the second quarter of this year.Enstar’s chief operating officer Paul O’Shea told The Royal Gazette yesterday that the company was working towards further deals and stressed the company’s view that the SeaBright acquisition was good business.“We’re delighted with this transaction,” Mr O’Shea said. “It’s an example of Enstar being able to assist with restructuring and consolidation within the insurance industry.“We believe this was a fair transaction, which continues to safeguard the policyholders while providing value to shareholders.”He added that Enstar’s success higlighted the fact that Bermuda can provide “the full spectrum of insurance services” to the world.Under the terms of the merger agreement, a newly formed wholly-owned subsidiary of Enstar will merge with and into SeaBright, with SeaBright surviving as a wholly-owned subsidiary of Enstar. Enstar expects to finance the purchase through a combination of cash on hand and a bank loan facility to be finalised before closing.Completion of the transaction is conditioned on, among other things, the approval of SeaBright’s stockholders, regulatory approvals and satisfaction of various customary closing conditions. SeaBright intends to solicit the approval of its stockholders at a special meeting of stockholders to be held later this year.“The acquisition of SeaBright is an exciting opportunity for Enstar,” said Dominic Silvester, chief executive officer of Enstar in a statement. “We continue to focus on expanding in the US, and we believe SeaBright will be a significant addition to our portfolio. We look forward to working with SeaBright to ensure that its policyholders continue to receive excellent service.”Enstar is discussing opportunities with third-party insurance companies for the assumption of SeaBright’s policy renewals.John Pasqualetto, chairman, president and CEO of SeaBright, said: “This transaction will, upon closing, provide our stockholders with immediate liquidity at a price representing a significant premium to market.“The transaction, which the board of directors has unanimously concluded is in the best interest of our stockholders, is the culmination of a lengthy and extensive process in which the Board carefully considered a broad range of strategic alternatives.”Sandler O’Neill & Partners, LP is acting as financial adviser to SeaBright and has delivered a fairness opinion in connection with the transaction. Kirkland & Ellis LLP is acting as legal adviser and Mayer Brown LLP is acting as special regulatory counsel to SeaBright. Drinker Biddle & Reath LLP is acting as legal adviser to Enstar.