AIG Agrees to Sell Stake in Ascot Lloyd’s Syndicate, Maintains Strategic Relationship with Ascot in Bermuda
September 16 2016 - 8:15AM
Business Wire
American International Group, Inc. (NYSE:AIG) today announced
that it has entered into an agreement to sell its interest in Ascot
Underwriting Holdings Ltd. (AUHL) and related syndicate-funding
subsidiary Ascot Corporate Name Ltd. (ACNL) (together Ascot) to
Canada Pension Plan Investment Board (CPPIB), a professional
investment management organization that invests the assets of the
Canada Pension Plan. The transaction is subject to regulatory
approvals.
Total consideration for the deal is $1.1 billion inclusive of
CPPIB’s recapitalization of Syndicate 1414’s Funds at Lloyd’s (FAL)
capital requirements. AIG will receive approximately $240 million
in net cash proceeds from the transaction after the FAL
recapitalization and release of the AIG-guaranteed Letter of Credit
currently supporting the syndicate’s FAL. Proceeds reflect AIG’s 20
percent stake in AUHL and ownership of ACNL.
Ascot and AIG founded the managing agency and the syndicate in
2001. As a global specialty insurance underwriter, Ascot focuses on
property insurance, marine insurance, and reinsurance.
AIG will maintain its strategic partnership with Ascot
Underwriting Bermuda Ltd. (AUB). While AUB is a wholly-owned
subsidiary of AUHL and part of the sale to CPPIB, AUB will continue
to serve as the managing general agent for AIG-Ascot Re, which
writes assumed treaty reinsurance business on behalf of AIG’s
wholly owned subsidiary American International Reinsurance Company
Ltd. (AIRCO) in Bermuda.
As part of the agreement, AIG, CPPIB, and Ascot intend to expand
a collective commercial relationship in Bermuda, and for AIG to be
a preferred reinsurer to Syndicate 1414.
“This deal successfully repositions our strategic focus and
underwriting capacity to our relationship with Ascot in Bermuda,
while monetizing our position in the syndicate at an attractive
value and retaining exposure to the syndicate as a reinsurer,” said
Robert Schimek, Chief Executive Officer, Commercial Insurance. “We
are also pleased to start a collaborative relationship with CPPIB
who we see as an ideal partner for Ascot’s outstanding management
team.”
Andrew Brooks, Chief Executive Officer of Ascot Underwriting
Ltd. said, “Ascot and AIG have enjoyed a strong and profitable
relationship for over 15 years and we value the support that we
have received from AIG throughout that time. We are pleased to be
continuing our relationship through Ascot Underwriting Bermuda and
look forward to building on the success of that platform.”
Evercore served as financial advisor to AIG, and Freshfields
Bruckhaus Deringer served as legal advisor to AIG on the
transaction. Macquarie Capital served as financial advisor to Ascot
Underwriting Holdings Limited.
Canada Pension Plan Investment Board is a professional
investment management organization that invests the assets of the
Canada Pension Plan (CPP) not currently needed to pay benefits on
behalf of 19 million contributors and beneficiaries. As of June 30,
2016, the CPP Fund totaled C$287.3 billion.
This press release contains “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995. These forward-looking statements, including the closing of
the transaction described herein, are not historical facts but
instead represent only AIG’s belief regarding future events, many
of which, by their nature, are inherently uncertain and outside
AIG’s control. Except for AIG’s ongoing obligation to disclose
material information as required by federal securities laws, AIG is
not under any obligation (and expressly disclaims any obligation)
to update or alter any forward-looking statements, whether written
or oral, that may be made from time to time, whether as a result of
new information, future events or otherwise. Factors that could
cause AIG’s actual results to differ, possibly materially, from any
forward-looking statements include the factors set forth in AIG’s
filings with the United States Securities and Exchange
Commission.
# # #
American International Group, Inc. (AIG) is a leading global
insurance organization. Founded in 1919, today we provide a wide
range of property casualty insurance, life insurance, retirement
products, mortgage insurance and other financial services to
customers in more than 100 countries and jurisdictions. Our diverse
offerings include products and services that help businesses and
individuals protect their assets, manage risks and provide for
retirement security. AIG common stock is listed on the New York
Stock Exchange and the Tokyo Stock Exchange.
Additional information about AIG can be found at www.aig.com and
www.aig.com/strategyupdate | YouTube: www.youtube.com/aig |
Twitter: @AIGinsurance | LinkedIn:
http://www.linkedin.com/company/aig. These references with
additional information about AIG have been provided as a
convenience, and the information contained on such websites is not
incorporated by reference into this press release.
AIG is the marketing name for the worldwide property-casualty,
life and retirement, and general insurance operations of American
International Group, Inc. For additional information, please visit
our website at www.aig.com. All products and services are written
or provided by subsidiaries or affiliates of American International
Group, Inc. Products or services may not be available in all
countries, and coverage is subject to actual policy language.
Non-insurance products and services may be provided by independent
third parties. Certain property-casualty coverages may be provided
by a surplus lines insurer. Surplus lines insurers do not generally
participate in state guaranty funds, and insureds are therefore not
protected by such funds.
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version on businesswire.com: http://www.businesswire.com/news/home/20160916005392/en/
AIGMedia:Matt Gallagher,
212-458-3247matthew.gallagher2@aig.comorInvestors:Liz Werner,
212-770-7074elizabeth.werner@aig.com
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