The Midland Company entered into a definitive merger agreement with Munich Re, which will acquire all of Midland's outstanding stock. Munich Re will purchase specialty insurance company Midland Co. for $1.3 billion to improve profitability in the United States. Munich Re would pay $65 per share for Midland, a 13.5 percent premium over Midland's closing price of $57.27 on October 16, 2007.