Investor Call scheduled for 8:30 a.m. ET,
11/14/16
Argo Group International Holdings, Ltd. (NASDAQ: AGII), an
international underwriter of specialty insurance and reinsurance
products, today announced it has entered into an agreement to
acquire Ariel Re, a global underwriter of insurance and reinsurance
business for approximately $235 million cash. The acquisition,
which is expected to be complete during the first quarter of 2017,
is subject to relevant regulatory approvals.
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View the full release here:
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Argo Group CEO Mark E. Watson III (Photo:
Business Wire)
“Ariel Re is a terrific fit for Argo Group - operationally and
culturally,” says Argo Group CEO Mark E. Watson III. “We remain
focused on delivering enhanced shareholder value. This transaction
enables us to build upon the successes realized individually by
Argo Group and Ariel Re, utilizing our combined strength to deploy
capital in selected areas to produce maximum return and continued
growth.
“Under the leadership of Jose A. Hernandez, head of Argo Group’s
International Business, the combination of Ariel Re and Argo Re
will result in a market-leading business and will make a meaningful
and immediate contribution to earnings and return on equity.
“This acquisition is part of Argo Group’s strategic initiative
to build scale in its London- and Bermuda-based platforms by adding
complementary lines of specialty business. After the acquisition,
Argo Group will have a well-balanced portfolio mix of approximately
88 percent insurance and 12 percent reinsurance,” adds Watson.
This transaction provides Argo Group with added diversification,
which improves the company’s ability to manage through changing
market cycles. It also adds new capabilities that can be leveraged
throughout the entire organization, including Ariel Re’s unique
modeling and risk analysis tools, which will enhance Argo’s already
robust underwriting analytics.
“Ariel Re is a group of proven insurance experts who rely on
deep domain expertise, rigorous research and development, and
innovative thinking - values and capabilities that align with those
of Argo Group,” says Hernandez.
Ariel Re is jointly owned by Banco BTG Pactual S.A. and the Abu
Dhabi Investment Council and underwrites a global portfolio of
insurance and reinsurance business through Lloyd’s Syndicate 1910.
Ariel Re’s book of business is well diversified by distribution,
regional exposure and peril. The company has achieved superior
returns by sourcing low-frequency/higher-severity, high-margin
business.
“Argo Group have long been supporters of Ariel Re and we are
delighted to take this relationship forward by bringing Ariel Re
under the Argo banner,” says Ryan Mather, Ariel Re CEO. “There is
great synergy between the teams from both companies and we are
looking forward to working together to strengthen the offering for
our clients.”
Argo Group’s financial advisor in connection with the
transaction is Aon Securities. Its legal counsel is Willkie Farr
& Gallagher LLP.
Investor Conference Call to Discuss Acquisition
Argo Group management will conduct a special investor conference
call to discuss the recent agreement to acquire Ariel Re. Company
management will conduct this call starting at 8:30 a.m. ET on
Monday, Nov. 14, 2016.
Joining the Conference Call
A live webcast of the conference call can be accessed by
visiting http://services.choruscall.com/links/agii161114.html.
Participants inside the U.S. can access the call by phone by
dialing 877-291-5203. Callers dialing from outside the U.S. can
access the call by dialing 412-902-6610. Please ask the operator to
be connected to the Argo Group conference call.
For those unable to attend the live conference, Argo Group will
post a webcast replay of the call on its investor relations
website, or at the following link:
https://services.choruscall.com/ccforms/replay.html. In addition, a
telephone replay of the call will be available through Nov. 21,
2016, to callers from inside the U.S. by dialing 877-344-7529
(conference #10096859). Callers dialing from outside the U.S. can
access the telephone replay by dialing 412-317-0088 (conference
#10096859).
ABOUT ARGO GROUP INTERNATIONAL HOLDINGS, LTD.
Argo Group International Holdings, Ltd. (NASDAQ: AGII) is an
international underwriter of specialty insurance and reinsurance
products in the property and casualty market. Argo Group offers a
full line of products and services designed to meet the unique
coverage and claims handling needs of businesses in four primary
segments: Excess & Surplus Lines, Commercial Specialty,
International Specialty and Syndicate 1200. Argo Group's insurance
subsidiaries are A. M. Best-rated 'A' (Excellent) (fourth highest
rating out of 16 rating classifications) with a stable outlook, and
Argo's U.S. insurance subsidiaries are Standard and Poor's-rated
'A-' (Strong) with a stable outlook. More information on Argo Group
and its subsidiaries is available at www.argolimited.com.
ABOUT ARIEL RE
Ariel Re is a (re)insurance company based in Bermuda that
underwrites a global portfolio of insurance and reinsurance
business through offices in London, Bermuda, Atlanta and Kansas
City via Lloyd’s Syndicate 1910, which is rated ‘A’ by A.M. Best
and ‘A+’ by Standard & Poor’s. Ariel Re was established by Don
Kramer with a consortium of private equity sponsors, which included
Blackstone, Thomas H. Lee and Oak Hill. It is currently jointly
owned by Banco BTG Pactual S.A. and the Abu Dhabi Investment
Council. Ariel Re is an industry leader in the (re)insurance
marketplace known for its state-of-the-art proprietary pricing and
portfolio management system, deep industry expertise, innovative
approach, and intense focus on customers. For more information,
visit www.arielre.com.
FORWARD-LOOKING STATEMENTS
This press release may include forward-looking statements, both
with respect to Argo Group and its industry, that reflect our
current views with respect to future events and financial
performance. These statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include all statements that do not
relate solely to historical or current facts, and can be identified
by the use of words such as “expect,” “intend,” “plan,” “believe,”
“do not believe,” “aim,” “project,” “anticipate,” “seek,” “will,”
“likely,” “assume,” “estimate,” “may,” “continue,” “guidance,”
“objective,” “outlook,” “trends,” “future,” “could,” “would,”
“should,” “target,” “on track” and similar expressions of a future
or forward-looking nature. All forward-looking statements address
matters that involve risks and uncertainties, many of which are
beyond Argo Group's control. Accordingly, there are or will be
important factors that could cause actual results to differ
materially from those indicated in such statements and, therefore,
you should not place undue reliance on any such statements. We
believe that these factors include, but are not limited to, the
following: 1) unpredictability and severity of catastrophic events;
2) rating agency actions; 3) adequacy of our risk management and
loss limitation methods; 4) cyclicality of demand and pricing in
the insurance and reinsurance markets; 5) statutory or regulatory
developments including tax policy, reinsurance and other regulatory
matters; 6) our ability to implement our business strategy; 7)
adequacy of our loss reserves; 8) continued availability of capital
and financing; 9) retention of key personnel; 10) competition; 11)
potential loss of business from one or more major insurance or
reinsurance brokers; 12) our ability to implement, successfully and
on a timely basis, complex infrastructure, distribution
capabilities, systems, procedures and internal controls, and to
develop accurate actuarial data to support the business and
regulatory and reporting requirements; 13) general economic and
market conditions (including inflation, volatility in the credit
and capital markets, interest rates and foreign currency exchange
rates); 14) the integration of businesses we may acquire or new
business ventures we may start; 15) the effect on our investment
portfolios of changing financial market conditions including
inflation, interest rates, liquidity and other factors; 16) acts of
terrorism or outbreak of war; and 17) availability of reinsurance
and retrocessional coverage, as well as management's response to
any of the aforementioned factors.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161114005753/en/
Argo GroupSusan Spivak Bernstein, 212-607-8835Senior Vice
President, Investor RelationsorDavid Snowden,
210-321-2104Senior Vice President, Corporate Communications
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