Enstar Group Ltd., a Bermuda company that acquires and manages insurance and reinsurance companies and portfolios of insurance and reinsurance business in run-off, and offers management, consultancy and other services to the insurance and reinsurance industry, has entered a definitive agreement to acquire global specialty insurer Torus Insurance Holdings Ltd. The total consideration for the transaction, which is expected to close by the end of the year, is $692 million.
Enstar will issue approximately 1,901,000 ordinary voting shares and approximately 711,000 newly created non-voting preferred shares having an aggregate value of approximately $346 million to partially fund the purchase price. Enstar will also contribute approximately $69 million in cash toward the purchase price, with affiliates of Stone Point Capital LLC, a financial services-focused private equity firm, funding the remaining approximately $277 million through an equity co-investment. Following the closing of the transaction, Enstar will own 60 percent of Torus and Stone Point will own 40 percent.
Enstar, which expanded into live underwriting with its June 2013 definitive agreement to acquire Atrium Underwriting Group, also announced that affiliates of Stone Point have committed to provide up to $106 million of equity capital toward the acquisition and a previous acquisition of Arden Reinsurance Co.
"Following the recent announcement of our agreement to acquire Atrium, we are pleased to continue our expansion into 'live' underwriting through the acquisition of Torus,” said Dominic Silvester, Enstar's CEO. “Torus provides us with an opportunity to acquire a large, international A- rated group of companies that both diversifies Enstar into the active market and enhances the opportunities available to our core legacy business.”
Torus is the holding company of six wholly owned insurance vehicles:
- Torus Insurance (UK) Limited, a UK insurer regulated by the Financial Conduct Authority and the Prudential Regulation Authority
- Torus Specialty Insurance Company, a US excess and surplus lines insurer and a Brazilian admitted reinsurer
- Torus National Insurance Company, a US admitted markets insurer
- Torus Insurance (Bermuda) Limited, a Class-4 insurer domiciled in Bermuda
- Torus Insurance (Europe) AG, a Liechtenstein-based European specialty insurer
- Syndicate 1301, managed by Torus Underwriting Management Limited, a Lloyd’s registered managing agency
Today, the insurer announced Dermot O’Donohoe has been appointed group CEO of the Torus Group, in addition to his position as Chief Executive, Torus International, which he’s held since 2011. He joined Torus in 2009 as chief underwriting officer, global specialty, and chief operating officer of Torus in the UK and Europe. Prior to Torus he was chief underwriting officer of XL Insurance’s global specialty operations and CEO of its London market operations and is also a former member of the Council of Lloyd’s.
O’Donohoe succeeds Clive Tobin, who is retiring and stepping down as an officer and director following four years of leadership. “Clive has been a strong leader and we greatly appreciate his contributions to Torus’ development during the company’s formative years,” O’Donohoe said. “Under his leadership, Torus has achieved significant operational scale and global reach. We wish him well in his retirement. I look forward to working with the Board and Senior Leadership Team in an expanded capacity as we continue to grow the Torus franchise.”
