AEGON N.V. has agreed to pay $293 million in cash for Clark Inc., a player in the U.S. executive benefits market.
AEGON., The Hague, Netherlands, would be paying Clark stockholders an average of about $16.55 per share. That compares with a closing price of $12.50 the afternoon before the deal was announced.
AEGON already owns 13% of Clark’s stock through an affiliate, AUSA Holdings Inc., and AUSA has been paying Clark $2.5 million per year under an administrative services and bonus forfeiture agreement, according to reports Clark has filed with the U.S. Securities and Exchange Commission.
Representatives for securities lawyers have been posting to Internet message boards in an effort to find investors who want to force Clark to find a suitor who will pay a higher price.
AEGON notes in the deal announcement that the acquisition agreement gives Clark managers the right to solicit offers from other potential buyers.
Clark, founded in 1967, may be best known for units that sell corporate-owned life insurance, bank-owned life insurance and a variety of executive compensation arrangements, but the company has acquired many other boutique operations over the years, such as its federal policy group, a Washington lobbying firm.
AEGON is acquiring Clark partly to expand distribution for its COLI and BOLI products, AEGON says.
A Clark management group, Clark Wamberg L.L.C., wants to buy the lobbying operation and several other divisions that AEGON does not want, Clark says. The other divisions include Clark’s Pearl Meyer & Partners executive compensation consulting unit, its Medex wholesale stop-loss unit, and its Clark Benson and Baden financial and estate planning subsidiary.
Clark paid $11 million for the lobbying firm, $26 million for Pearl Meyer, $8.6 million for Medex and $8 million for Baden Retirement Plan Services, according to Clark.
Clark will see if outside buyers are willing to pay more than Clark Wamberg for the divisions that AEGON does not want, Clark says.
“If a proposal that is deemed superior by the special committee of independent directors is received and accepted, the asset purchase agreement with Clark Wamberg will be terminated without cost,” Clark says.