News Column

Atlas Announces Completion of Public Offering

May 27, 2014

CHICAGO--(BUSINESS WIRE)-- Atlas Financial Holdings, Inc. (NASDAQ:AFH) (“Atlas” or the “Company”) today announced the closing and settlement of its underwritten public offering of 2,000,000 ordinary common shares of the Company at a price to the public of $12.50 per share for gross proceeds of $25,000,000. Underwriters exercised their right to purchase an additional 161,000 common shares increasing gross proceeds to $27,012,500. The net proceeds from the sale of the shares, after deducting the underwriters’ discounts and other estimated offering expenses payable by the Company, will be approximately $25,061,750. Total outstanding common shares are 11,771,586 after the issuance.

On a pro-forma basis, book value per common share based on March 31, 2014 actual results plus the net proceeds from this offering is $7.67 per common share as compared to the reported figure of $6.79. The Company had $0.91 per common share of deferred tax assets at March 31, 2014 which were not included in book value per common share. On a pro-forma basis after the new share issuance this is $0.74 per common share. Atlas plans to use the net proceeds from the offering for general corporate purposes, including, without limitation, business expansion, working capital and possible acquisitions.

“We expect this capital raise to allow Atlas to continue to take advantage of the increasingly favorable insurance market conditions we’ve identified in our specialty niche and are pleased to have completed the offering at this time,” commented Scott D. Wollney, President & CEO, “Our focus has been, and remains, to consistently exceed the P&C insurance industry return on equity. With this incremental capital coupled with the opportunities we are pursuing, achieving this goal on an even larger scale is possible.”

As previously communicated, Atlas' first quarter 2014 net income, adjusted pro-forma to exclude certain non-recurring expenses, resulted in an annualized return on common equity as follows:

(Amounts in $000)        
Net income attributable to Atlas       $2,192
Less: Preferred share dividends       23
Net income attributable to common shareholders       2,169
Add: Management incentive compensation (amount in excess of accrual)       500
Adjusted net income attributable to common shareholders       $2,669
Average common equity at March 31, 2014       $63,445
Annualized return on common equity (pro-forma)       16.8%
         
Average common equity pro-forma after capital raise       $75,976
Annualized return on common equity pro-forma after capital raise       14.1%
     


Sandler O’Neill + Partners, L.P. acted as the book-running manager for the offering. Janney Montgomery Scott LLC and Sterne, Agee & Leach, Inc. acted as co-managers for the offering.

About Atlas Financial Holdings, Inc.

The primary business of Atlas is commercial automobile insurance in the United States, with a niche market orientation and focus on insurance for the "light" commercial automobile sector including taxi cabs, non-emergency paratransit, limousine/livery and business auto. The business of Atlas is carried on through its insurance subsidiaries American Country Insurance Company, American Service Insurance Company, Inc. and Gateway Insurance Company. Atlas’ insurance subsidiaries have decades of experience with a commitment to being an industry leader in these specialized areas of insurance.

Forward-looking Statements

This release includes forward-looking statements regarding Atlas and its insurance subsidiaries and businesses. Such statements are based on the current expectations of the management of each entity. The words "anticipate", "expect", "believe", "may", "should", "estimate", "project", "outlook", "forecast" or similar words are used to identify such forward looking information. The forward-looking events and circumstances discussed in this release may not occur and could differ materially as a result of known and unknown risk factors and uncertainties affecting the Company and its subsidiaries, including risks regarding the insurance industry, economic factors and the equity markets generally and the risk factors discussed in the "Risk Factors" section of the Company's registration statement on Form S-3 and the prospectus supplement. No forward-looking statement can be guaranteed. Except as required by applicable securities laws, forward-looking statements speak only as of the date on which they are made and Atlas and its subsidiaries undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise.



Atlas Financial Holdings, Inc.

Scott Wollney, 847-700-8600

CEO

swollney@atlas-fin.com

Source: Atlas Financial Holdings, Inc.


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