XL Capital Ltd (NYSE: XL), today announced that it plans to integrate its reinsurance operations following the ratification in January this year of XL’s previously announced acquisition of a 67% majority shareholding in Le Mans Re. Le Mans Re is a joint venture reinsurer formed by XL and MMA in 1999.
The proposed integration, which is intended to streamline XL’s reinsurance operations, is subject to the satisfaction of certain conditions, including the receipt of regulatory and other approvals. Le Mans Re and XL Re Ltd propose to merge their branches in Singapore. The proposal also calls for the closure of the Le Mans Re underwriting operation in Miami and the merger of Le Mans Re’s continuing Miami-based business with XL Re Latin America Ltd’s operations.
Henry Keeling, Chief Executive of Reinsurance Operations for XL Capital Ltd, said: “Le Mans Re has become the primary vehicle for the expansion of XL Re’s position in Continental Europe. Therefore, we believe that XL needs to dedicate as much of Le Mans Re’s professional resources, energy and expert management time to implementing our strategy in this large and very important market.”
Keeling notes, “The goal behind the proposal to merge the Singapore branches is to create an operation that will act as a regional hub for the development of XL Re Ltd’s business in Asia and Australia. Le Mans Re will be responsible for the run-off of its existing portfolio in Singapore, but continuing business will be conducted in the name of XL Re Ltd. Additionally, the Le Mans Re operation in Miami, which has responsibility for property and casualty business in Latin America and the Caribbean, will be closed and the Le Mans Re office in France will become responsible for the management and run off of its existing portfolio.”
“At the same time, XL Re plans to reduce the scope of its operations in Australia, while maintaining its existing branch license there. While business will continue to be underwritten in Sydney, management of the Australian branch will be directed from Singapore.”