Arch Capital Group Ltd. to Acquire Westpac Lenders Mortgage Insurance Limited
March 17 2021 - 8:18PM
Business Wire
The Global Mortgage Group of Arch Capital Group Ltd. (NASDAQ:
ACGL) has entered into a share purchase agreement with the Westpac
Group (Westpac) to acquire Westpac Lenders Mortgage Insurance
Limited (WLMI), an Australian Prudential Regulation Authority
(APRA) authorized captive lenders mortgage insurance (LMI) provider
to Westpac. WLMI had shareholders’ equity of $AUD 285.7 million as
of Sept. 30, 2020.
As part of the agreement, WLMI will retain its existing risk in
force and become Westpac’s exclusive provider of LMI on new
mortgage originations for a period of 10 years. Upon completion of
the transaction, Arch intends to combine the operations of WLMI and
its existing Australian LMI company, Arch LMI Pty Ltd.
Arch has been active in the Australian LMI market since 2011,
when it began providing support for WLMI’s reinsurance treaties. In
2019, Arch LMI Pty Ltd was authorized as a lenders mortgage insurer
by APRA. The acquisition of WLMI will secure Arch’s Australian LMI
flow of business from Westpac Bank and augment the Company’s
position as the only globally diversified insurer of mortgage
credit risk. In addition to Australia, Arch has mortgage insurance
and reinsurance operations in Bermuda, Europe and the United
States.
“Australia has been and continues to be an important market for
our mortgage insurance business. This acquisition reinforces our
commitment to both the market and our clients and enhances Arch’s
position as a leading provider of LMI in Australia,” said David
Gansberg, CEO, Global Mortgage for Arch Capital Group Ltd. “We look
forward to continuing our long-standing partnership with Westpac by
being their exclusive provider of LMI and will remain focused on
providing innovative solutions and excellent service to clients
across Australia.”
The transaction is expected to close later this year pending
antitrust and regulatory approvals from APRA and from the
Australian Competition and Consumer Commission.
Advisors
Credit Suisse acted as financial advisor, KPMG acted as tax
advisor and Clyde & Co acted as legal advisor to Arch in the
transaction.
About Arch Capital Group Ltd.
Arch Capital Group Ltd., a publicly listed Bermuda exempted
company with approximately $15.8 billion in capital at Dec. 31,
2020, provides insurance, reinsurance and mortgage insurance on a
worldwide basis through its wholly owned subsidiaries.
Cautionary Note Regarding Forward-looking Statements
The Private Securities Litigation Reform Act of 1995 provides a
"safe harbor" for forward−looking statements. This release or any
other written or oral statements made by or on behalf of Arch
Capital Group Ltd. and its subsidiaries may include forward−looking
statements, which reflect our current views with respect to future
events and financial performance. All statements other than
statements of historical fact included in or incorporated by
reference in this release are forward−looking statements.
Forward−looking statements can generally be identified by the
use of forward−looking terminology such as "may," "will," "expect,"
"intend," "estimate," "anticipate," "believe" or "continue" or
their negative or variations or similar terminology.
Forward−looking statements involve our current assessment of risks
and uncertainties. Actual events and results may differ materially
from those expressed or implied in these statements. A
non-exclusive list of the important factors that could cause actual
results to differ materially from those in such forward-looking
statements includes the following: adverse general economic and
market conditions; increased competition; pricing and policy term
trends; fluctuations in the actions of rating agencies and the
Company’s ability to maintain and improve its ratings; investment
performance; the loss of key personnel; the adequacy of the
Company’s loss reserves, severity and/or frequency of losses,
greater than expected loss ratios and adverse development on claim
and/or claim expense liabilities; greater frequency or severity of
unpredictable natural and man-made catastrophic events,
including pandemics such as COVID-19; the impact of acts of
terrorism and acts of war; changes in regulations and/or tax laws
in the United States or elsewhere; the Company’s ability to
successfully integrate, establish and maintain operating procedures
as well as integrate the businesses the Company has acquired or may
acquire into the existing operations; changes in accounting
principles or policies; material differences between actual and
expected assessments for guaranty funds and mandatory pooling
arrangements; availability and cost to the Company of reinsurance
to manage the Company’s gross and net exposures; the failure of
others to meet their obligations to the Company; changes in the
method for determining the London Inter-bank Offered Rate (“LIBOR”)
and the potential replacement of LIBOR and other factors identified
in the Company’s filings with the U.S. Securities and Exchange
Commission (“SEC”).
The foregoing review of important factors should not be
construed as exhaustive and should be read in conjunction with
other cautionary statements that are included herein or elsewhere.
All subsequent written and oral forward−looking statements
attributable to us or persons acting on our behalf are expressly
qualified in their entirety by these cautionary statements. The
Company undertakes no obligation to publicly update or revise any
forward−looking statement, whether as a result of new information,
future events or otherwise.
arch-corporate arch-mortgage
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version on businesswire.com: https://www.businesswire.com/news/home/20210317005902/en/
Greg Hare, SVP Branding & Employee Communications Services
Arch Capital Services LLC 336 333 0414 /
ghare@archcapservices.com
Damian Smith, CEO & Country Manager Arch LMI +1 0411604082 /
dsmith@archlmi.com
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