The Progressive Corporation (NYSE:PGR) entered into a definitive agreement to acquire Protective Insurance Corporation (NasdaqGM:PTVC.B) from group of sellers for approximately $340 million on February 14, 2021. The Progressive agreed to acquire all the outstanding Class A and Class B common shares of Protective for $23.30 per share in cash, for a total transaction value of approximately $338 million. Progressive will fund the purchase through liquid investments on hand i.e. cash from operations or securities Progressive Corporation currently hold. Under limited circumstances, Protective Insurance would be required to pay a termination fee of $13.3 million to The Progressive Corporation, providing for a termination fee equal to 4.5% of the Protective's implied equity value based on the merger consideration. Progressive plans to maintain Protective's offices in Carmel, Indiana and retain Protective's employees.

The acquisition is subject to customary closing conditions, including receipt of certain required regulatory approvals and approval of Protective's Class A shareholders and the applicable waiting periods, together with any extensions thereof, under the HSR Act shall have expired or been terminated. Protective's Board of Directors has unanimously approved the transaction, based on the unanimous recommendation of the Special Committee of the Board. The Board of Directors of Progressive also approved the deal. Protective's class A shareholders approved the transaction on May 5, 2021. As of May 6, 2021, the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 with respect to the transaction has expired. As of May 25, 2021, Indiana Department of Insurance approved the transaction. The acquisition is expected to close prior to the end of the third quarter of 2021. As of May 6, 2021, the transaction is expected to close in June or July 2021. As of May 25, 2021, the transaction is expected to be completed on or about June 1, 2021.

John M. Gherlein and John J. Harrington of Baker & Hostetler LLP are serving as legal advisors to Progressive. Piper Sandler & Co. is serving as financial advisor and fairness opinion provider to Protective and Todd E. Freed, Jessica Hough and Young Park of Skadden, Arps, Slate, Meagher & Flom LLP are serving as legal advisor to Protective. Innisfree M&A Inc. acted as proxy solicitor for Protective. Sidley Austin LLP acted as legal advisor to Shapiro family Partnership trust and other selling shareholders. Protective has agreed to pay Piper Sandler a fee which is currently estimated to be approximately $4.6 million. A significant portion of the fee is contingent upon the consummation of the merger, and $1.3 million of such fee has been earned by Piper Sandler in rendering its fairness opinion and is creditable against the total fee. Protective estimates that it will pay Innisfree a fee of approximately $45,000 and reimbursement of certain expenses.

The Progressive Corporation (NYSE:PGR) completed the acquisition of Protective Insurance Corporation (NasdaqGM:PTVC.B) from group of sellers on June 1, 2021. Pursuant to the Merger Agreement, at the Effective Time, Stephen J. Gray, Nathan Shapiro, Robert Shapiro, Stuart D. Bilton, Otto N. Frenzel IV, LoriAnn V. Lowery-Biggers, James A. Porcari III, Steven J. Bensinger, Jeremy D. Edgecliffe-Johnson, David W. Michelson and John D. Nichols, Jr. each ceased to be directors of Protective Insurance and members of any committee of it's Board of Directors. Pursuant to the Merger Agreement, at the Effective Time, the directors of Merger Sub immediately prior to the Effective Time, Andrew Quigg and John Barbagallo, became the directors of Protective Insurance.