Fairfax has announced it would acquire AWAC for about $4.9 billion. We are affirming our ratings on Fairfax. The stable outlook is based on our expectation that the pending acquisition will proceed smoothly and the group's capital adequacy will remain very strong. On Dec. 21, 2016, S&P Global Ratings affirmed its 'BBB-' long-term counterparty credit and 'A-' financial strength ratings on Fairfax Financial Holdings Ltd. (Fairfax) and its core operating insurance subsidiaries following the company's Dec. 18, 2016, announcement that it had agreed to purchase Allied World Insurance Co. (AWAC) for $54 per share, or approximately $4.9 billion in cash and stock. We expect the transaction to close in the first half of 2017 pending shareholder and regulatory approvals. The
