New York - AmTrust Financial Services, through its subsidiary AMT Warranty, has acquired the remaining 73 percent ownership interest in Warrantech, bringing its total ownership interest to 100 percent.
through the second quarter of 2010, AmTrust has generated more than $224 million in written premium with strong underwriting profits as a result of its original ownership interest in Warrantech, AmTrust said in a statement.
AmTrust Financial Services president/CEO Barry Zyskind said, "By bringing together these two robust warranty administration platforms, we expect to significantly increase our fee income and benefit from enhanced scale and technology efficiencies while further strengthening AmTrust's market presence and premium opportunities in the warranty space. We believe the talent and experience of the newly combined platform will provide additional momentum as we continue to deliver strong value for our clients and shareholders."
The transaction was funded with a net $7.5 million in cash and includes an earn-out payment to the sellers of a minimum of $2 million with a maximum of $3 million based on AMT Warranty's EBITDA. Additionally, immediately following the transaction, the company's existing $24.1 million note receivable from Warrantech was transferred to AMT Warranty.