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Aspen Insurance agrees to be taken private


September 1, 2018   by Greg Meckbach


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Aspen Insurance Holdings Ltd., which writes risks in Canada, has tentatively agreed to be bought for US$2.6 billion.

If the deal closes, Hamilton, Bermuda-based Aspen will be owned by private equity firm Apollo Global Management LLC of New York City. Aspen’s board is recommending that shareholders of the publicly-traded company vote in favour of the deal.

Aspen does not have a bricks-and-mortar office in Canada. A subsidiary, Aspen Insurance U.K.,  is licensed to sell insurance in Canada. Aspen UK’s chief agent in Canada is Toronto lawyer Brian Reeve, a partner specializing in insurance regulation with Cassels Brock & Blackwell LLP.

Aspen UK wrote about $2 million in surety in Canada in 2017, according to the Canadian Underwriter 2018 Stats Guide.

Worldwide in 2017, Aspen had gross premiums written of US$1.5 billion in reinsurance and $1.8 billion in primary insurance

Commercial insurer and reinsurer Endurance Specialty Holdings Ltd. offered to acquire Aspen for US$3.2 billion in 2014. That is about 14% more than what Apollo is offering in the deal announced Aug. 28, 2018. Endurance later withdrew the offer, which was never put to Aspen shareholders for a vote. Aspen’s board of directors had recommended in 2014 that company’s shareholders reject Endurance’s offer. The board said at the time that Endurance’s offer “undervalues” Aspen and “represents a strategic mismatch.” Endurance, like Aspen, is based in Hamilton and writes commercial primary insurance and reinsurance.

An acquisition by Apollo would let Aspen work with investors with expertise in reinsurance, Glyn Jones, Aspen’s chairman of the board, noted in a release.

If the deal is approved by Aspen shareholders and regulators, then it “is expected to close in the first half of 2019,” Apollo said in a release. Aspen would then cease to be publicly traded.