ProSight Specialty Insurance has entered into an agreement to acquire NYMAGIC, a US-based insurance holding company, for around $230m.

Under the terms of agreement, NYMAGIC stockholders will receive $25.75 per share in cash. The transaction will be 100% equity funded by ProSight Specialty Insurance.

According to NYMAGIC, the completion of transaction is expected to occur in the fourth quarter of 2010 and is subject to approval of NYMAGIC stockholders, customary closing conditions and regulatory approvals.

In addition, the company’s shareholders owning approximately 40% of its fully diluted common shares have executed voting agreements pursuant to which they have agreed to vote in favor of transaction.

Robert Simses, chairman of NYMAGIC, said: “We are pleased to reach an agreement with ProSight Specialty Insurance that we strongly believe is in the best interest of our shareholders, presenting them with excellent value for their shares.

“Our board of directors also strongly believes that this transaction will create attractive long-term opportunities for our employees, customers and business partners.”