Western Investment Company acquires livestock insurers Canadian Farm and Stockmens

The transaction involves the purchase of all issued and outstanding shares of Canadian Farm and Stockmens from affiliates of Nilsson Bros. Inc. (NBI). The acquisition price for Canadian Farm is $42.3 million and for Stockmens is $10.2 million. The total consideration is payable upon closing, expected in the first quarter of 2027, subject to customary post-closing adjustments. The acquisition of Canadian Farm is also subject to the approval of the Alberta Minister of Finance.

As part of the closing, NBI may receive up to $10.5 million of the total consideration through the issuance of approximately 9.8 million Western common shares at a price of $1.07 per share. The vendors have also agreed to guarantee an aggregate annual pre-tax earnings of up to $7.0 million for the acquired businesses in each of the first two years following closing.

Canadian Farm serves the Western Canadian livestock industry and holds a nationwide insurance license, excluding Quebec. The company specializes in transit insurance for livestock auctions and mortality insurance for livestock with breeding and fertility extensions. Stockmens comprises two managing general agencies that distribute mortality insurance for breeding bulls and other high-value livestock on behalf of a Lloyd's syndicate in Canada and an admitted carrier in the U.S.

To fund the cash portion of the transaction, Western is conducting a private placement of approximately 50 million common shares at a price of $1.00 per share, raising approximately $50 million in gross proceeds. Desjardins Capital Markets and TD Securities Inc. are acting as joint lead agents and bookrunners.

Following the closing of the transaction, Scott Tannas will step down as Chairman of the Board of Western, remain a director of the company, and assume the role of Chief Executive Officer of Canadian Farm. Paul Rivett will become Chairman of the Board of Western. Canadian Farm and Stockmens will continue to operate on a decentralized basis.