Stockholders' Equity

9 Months Ended

Sep. 30, 2019

7. Stockholders’ Equity

(a) Common Stock Repurchases

In November 2015, the Alleghany Board of Directors authorized the repurchase of shares of common stock of Alleghany, par value $1.00 per share (“Common Stock”), at such times and at prices as management determines to be advisable, up to an aggregate of $400.0 million (the “2015 Repurchase Program”). In June 2018, the Alleghany Board of Directors authorized, upon the completion of the 2015 Repurchase Program, the repurchase of additional shares of Common Stock, at such times and at prices as management determines to be advisable, up to an aggregate of $400.0 million (the “2018 Repurchase Program”). In September 2019, the Alleghany Board of Directors authorized, upon the completion of the 2018 Repurchase Program, the repurchase of additional shares of Common Stock, at such times and at prices as management determines to be advisable, up to an aggregate of $500.0 million. In the fourth quarter of 2018, Alleghany completed the 2015 Repurchase Program and subsequent repurchases have been made pursuant to the 2018 Repurchase Program. As of September 30, 2019, Alleghany had $659.1 million remaining under its share repurchase authorizations.

The following table presents the shares of Common Stock that Alleghany repurchased in the three and nine months ended September 30, 2019 and 2018:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Shares repurchased		25,398		76,299		174,211		479,922
Cost of shares repurchased (in millions)	$	19.3	$	46.0	$	112.4	$	282.1
Average price per share repurchased	$	759.70	$	602.24	$	645.46	$	587.70

(b) Accumulated Other Comprehensive Income (Loss)

The following tables present a reconciliation of the changes during the nine months ended September 30, 2019 and 2018 in accumulated other comprehensive income (loss) attributable to Alleghany stockholders:

	Unrealized Appreciation of Investments			Unrealized Currency Translation Adjustment			Retirement Plans			Total
	($ in millions)
Balance as of January 1, 2019	$	(61.6	)	$	(124.7	)	$	(15.7	)	$	(202.0	)
Other comprehensive income (loss), net of tax:
Other comprehensive income (loss) before reclassifications		442.2			(8.1	)		1.4			435.5
Reclassifications from accumulated other comprehensive income		(10.2	)		-			-			(10.2	)
Total		432.0			(8.1	)		1.4			425.3
Balance as of September 30, 2019	$	370.4		$	(132.8	)	$	(14.3	)	$	223.3

	Unrealized Appreciation of Investments			Unrealized Currency Translation Adjustment			Retirement Plans			Total
	($ in millions)
Balance as of January 1, 2018	$	718.2		$	(84.6	)	$	(15.5	)	$	618.1
Cumulative effect of adoption of new accounting pronouncements⁽¹⁾:
Reclassification of net unrealized gains on equity securities, net of tax		(735.6	)		-			-			(735.6	)
Reclassification of stranded taxes		156.6			(18.2	)		(3.3	)		135.1
Total		(579.0	)		(18.2	)		(3.3	)		(600.5	)
Other comprehensive income (loss), net of tax:
Other comprehensive income (loss) before reclassifications		(213.3	)		(6.9	)		(1.7	)		(221.9	)
Reclassifications from accumulated other comprehensive income		(16.5	)		-			-			(16.5	)
Total		(229.8	)		(6.9	)		(1.7	)		(238.4	)
Balance as of September 30, 2018	$	(90.6	)	$	(109.7	)	$	(20.5	)	$	(220.8	)

(1)	See Note 1(c) of this Form 10-Q for additional information on Alleghany’s adoption of new investment accounting guidance and new guidance on certain tax effects caused by the Tax Act.

The following table presents reclassifications out of accumulated other comprehensive income attributable to Alleghany stockholders during the three and nine months ended September 30, 2019 and 2018:

Accumulated Other		Three Months Ended September 30,						Nine Months Ended September 30,
Comprehensive Income Component	Line in Consolidated Statement of Earnings	2019			2018			2019			2018
		($ in millions)
Unrealized appreciation of investments:	Net realized capital gains⁽¹⁾	$	(9.8	)	$	(16.2	)	$	(26.6	)	$	(21.5	)
	Other than temporary impairment losses		3.6			-			13.6			0.5
	Income taxes		1.3			3.4			2.8			4.5
Total reclassifications:	Net earnings	$	(4.9	)	$	(12.8	)	$	(10.2	)	$	(16.5	)

(1)

For the three and nine months ended September 30, 2019, excludes a $5.8 million pre-tax loss related to the decrease in the fair value of the Put Option. See Note 3(d) for additional information. For the nine months ended September 30, 2018, excludes a $45.7 million pre-tax gain from AIHL’s conversion of its limited partnership interests in certain subsidiaries of Ares into Ares common units. See Note 3(h) of this Form 10-Q for additional information.

In February 2018, the Alleghany Board of Directors declared a special dividend of $10.00 per share for stockholders of record on March 5, 2018. On March 15, 2018, Alleghany paid dividends to stockholders totaling $154.0 million.