As expected, Phoenix Home Life Mutual Insurance Co. reached an agreement with Duff & Phelps Corp. to merge its money management subsidiary, Phoenix Securities Corp., with Duff & Phelps in a reverse merger worth approximately $15.40 per share. The merger will create a company with $35 billion in assets, renamed Phoenix Duff & Phelps Corp., which will be 60% owned by Phoenix Home Life.
Based on the closing price of $11 for Duff & Phelps stock June 13, the deal is valued at $266 million. Duff & Phelps shareholders will receive a cash dividend of $1.75 per share, as well as one share of new convertible preferred stock with a stated value of $25 and a $1.50 dividend for each 10 shares of Duff & Phelps common stock they own. The transaction is expected to close in October.
The management of both firms is expected to stay with the company. Francis E. Jeffries, chief executive officer and chairman of Duff & Phelps Corp., will be chairman of the merged company and Philip R. McLoughlin, Phoenix's executive vice president-investments, will be vice chairman and CEO; Calvin Pedersen, president of Duff & Phelps, will also be president of the new firm.
The company will be based in Hartford but will have offices in Chicago.