Property and casualty insurer Allstate said on Monday it would buy SquareTrade Holding for about $1.4 billion from a group of shareholders that include Bain Capital.
SquareTrade, founded in 1999 by Ahmed Khaishgi and Steve Abernethy, offers extended warranty plans for electronic gadgets.
San Francisco-headquartered SquareTrade’s customers include major retailers such as Amazon
, Costco Wholesale
, Sam’s Club, Target
, Office Depot
and Toys ‘R’ Us.
The deal, which will help AllState expand into new markets and products, is expected to close in January.
, which expects the acquisition to dilute its earnings per share for three years, intends to fund the deal with cash and debt.
Ardea Partners, Lazard and Willkie Farr & Gallagher advised Allstate, while Financial Technology Partners and Ropes & Gray advised SquareTrade.