Allied World Assurance Company last night announced that it had agreed to merge with US reinsurer Transatlantic Holdings.The boards of both companies have voted unanimously in favour of the deal, which will create a global insurer and reinsurer to be known as TransAllied Group Holdings, AG, with total invested assets of $21 billion and 39 offices in 18 countries.Allied’s chief executive officer Scott Carmilani will be president and CEO of the combined entity, while Transatlantic CEO Robert Orlich will retire on completion of the deal.“Both companies’ operations will benefit from a significant global footprint with access to distribution channels within all major markets as well as attractive geographic and product diversity,” Mr Carmilani said in last night’s statement.Following the “merger of equals”, Transatlantic shareholders will own approximately 58 percent of the combined company, with Allied World shareholders owning approximately 42 percent.Allied formed in Bermuda ten years ago and redomesticated to Switzerland last year. Both companies have operations in Bermuda.Closing of the deal is expected by the fourth quarter of this year, subject to approval by shareholders and regulators.