Investment in Investees

3 Months Ended

Mar. 31, 2013

Investment in Investees [Abstract]

Investment in Investee

INVESTMENT IN INVESTEE

Investment in investee includes the Company's investment in the preferred and restricted voting common stock of Atlas Financial Holdings Inc. ("Atlas").  The Company accounted for this investment as of and for the three months ended March 31, 2013 under the equity method because the Company was deemed to have significant influence over Atlas during this period.  The Company's investment in Atlas is recorded on a three-month lag basis.  The carrying value, estimated fair value and approximate voting and equity percentages at March 31, 2013 and December 31, 2012 were as follows:

(in thousands, except for percentages)
	March 31, 2013								December 31, 2012
	Voting percentage		Equity percentage		Estimated Fair Value		Carrying value		Voting percentage		Equity percentage		Estimated Fair Value		Carrying value
Atlas	16.5	%	16.5	%	$	25,994	$	26,526	30.0	%	63.3	%	$	38,758	$	41,733

The fair values of the Company's investment in Atlas at March 31, 2013 and December 31, 2012 in the table above are calculated based on the published closing prices of Atlas at December 31, 2012 and September 30, 2012, respectively, to be consistent with the three-month lag in reporting its carrying value under the equity method. The estimated fair value of the Company's investment in Atlas based on the published closing price of Atlas at March 31, 2013 is $25.5 million.

Equity in net income (loss) of investee was income of $0.3 million and a loss of $2.3 million for the three months ended March 31, 2013 and March 31, 2012, respectively. The Company also recognized a decrease to shareholders' equity attributable to common shareholders of $0.1 million for the three months ended March 31, 2013 for the Company's pro rata share of its investee's accumulated other comprehensive income.

Summarized financial information for Atlas is presented below at December 31, 2012. To be consistent with the three-month lag in reporting, total revenue and net income is presented below for the three months ended December 31, 2012:

(in thousands)	Three months ended December 31, 2012
Total revenue	12,851
Net income	1,244

On February 12, 2013, the Company executed an underwriting agreement to sell 2,625,000 shares of Atlas common stock. The shares were being offered as part of Atlas' United States initial public offering at a price per share of $5.85. The Company received net proceeds of $13.6 million and recognized a loss of $1.7 million which is included in net realized losses on the consolidated statements of operations, resulting from commissions and other expenses incurred as part of the sale, during the first quarter.