View of the headquarters building of Fosun Group in Shanghai, Feb 20, 2014. [Photo/IC]

Chinese conglomerate Fosun International Ltd will buy Meadowbrook Insurance Group for about $433 million to enter the US property and casualty insurance market.

The cash deal of $8.65 per share represents a 24 percent premium over Meadowbrook stock's closing price on Dec 29, the companies said on Tuesday.

Shares of Meadowbrook, a specialty commercial insurance underwriter and insurance administration services company, were up 14 percent at $8.15 in extended trading.

"This transaction allows Fosun to establish a presence in the important US P&C market," Chairman Guo Guangchang, also one of China's richest men, said.

Guo, who Forbes estimates has a net worth of about $4.3 billion, is also involved in a takeover bid for French holiday operator Club Mediterranee SA with Italian tycoon Andrea Bonom.

Fosun, which has a market capitalization of about $9.10 billion, is into insurance, industrial operations, investment and asset management.

The transaction, which has been approved by the boards of both the companies, is expected to close in the second half of 2015.

Meadowbrook will continue to maintain its headquarters in Southfield, Michigan and will operate under the Meadowbrook brand name.

KPMG and Willis Capital Markets & Advisory are the financial advisers to Fosun and Meadowbrook respectively.

DLA Piper LLP is the legal advisor to Fosun while Sidley Austin LLP advised Meadowbrook on the deal.