Till Capital signs agreement to acquire Toronto’s Omega Insurance

Hamilton, Bermuda-based Till Capital Ltd. recently announced it has signed agreements to acquire Toronto-based Omega Insurance Holdings Inc.

Till originally announced in late July that it had entered into a letter of intent with Omega and its shareholders. Then on Oct. 14 Till said it “will pay an aggregate purchase price of 1.2 times book value,” or $15.4 million as of June 30, “plus an amount not to exceed” $3 million  “for any transactions in process at closing, in exchange for all of the issued and outstanding shares of Omega.”

Omega Insurance’s subsidiaries include Omega General Insurance and Focus Group Inc. Omega’s offerings include services for insurers planning to exit the Canadian market. Omega gives such insurers “an ability to facilitate such an exit so that their financial, legal, and moral obligations are met on a continuing basis, while being able to repatriate their surplus capital in a more timely fashion,” Till Capital stated.

Omega CEO Phillip Cook has been the keynote speaker at CIP Society’s annual Industry Trends breakfast in downtown Toronto for several years. As of last July, Cook was chief agent for four insurers/reinsurers operating in Canada, Till stated. Cook established Focus Group in 1986 and has been CEO of Omega since 2004.

“We look forward to working with Till Capital as we enter the next phase of Omega’s development,” Cook stated in a release. “Till’s international footprint, along with a proven track record of successful investment strategies, will enable our combined organizations to achieve our corporate objectives while continuing to serve the needs of our policyholders and other stakeholders.”

The acquisition agreement is subject to some conditions, including approval by the Office of the Superintendent of Financial Institutions.

Till was formed, in August 2012, “to respond to the market opportunity presented by the need for more capacity for certain types of insurance and reinsurance,” Till Capital stated Aug. 26 in a Canadian securities filing. Till said at the time it “intends to primarily conduct reinsurance business” through Resource Re Ltd., which was formed as a Class 3A insurance company in Bermuda.

Till Capital noted in August, in its management discussion and analysis for shareholders, that its “business strategy will be to offer reinsurance coverage to a select group of insurance companies: captive insurers that wish to redeploy capital more productively, profitable privately held insurers with capital constraints that limit growth or wish to redeploy capital more productively, and insurers and reinsurers that are under regulatory capital or ratings stress.”