August 29, 2001 by Canadian Underwriter
A previously announced deal to sell the remaining insurance properties of troubled Queensway Financial Holdings has run aground. In a press release, Queensway announces that the deal to sell its U.S. insurance companies to Argonaut Group “has been terminated”. Reasons for the sale’s failure were not given, although in an earlier statement Queensway had alluded that if the sale price were not satisfactory, the deal could be terminated.
Queensway estimated a value in excess of US$40 million for the properties, which include North Pointe Financial Services, Hermitage Insurance Company, Consolidated Property & Casualty Insurance Company and Universal Fire and Casualty Company. The companies account for about 83% of Queensway’s assets.
The holding company has been in the process of selling off its operations, having announced the sale of its Canadian insurer, Coachman, and the resignation of its board of directors.
Interim receiver Ernst & Young says that “discussions have been advanced with several interested purchasers for certain of the insurance companies”. E&Y adds that senior lenders and state insurance regulators are also involved in the process and ensuring the companies continue to operate normally despite the sell-off.