Alternative asset manager Ares Management Corporation is to expand its existing insurance platform with the launch of Aspida Financial, an indirect subsidiary of Ares.
Additionally, Ares has announced the purchase, by Aspida, of Pavonia Life Insurance Company, a Michigan-domiciled insurance company with approximately $1.1 billion of assets and approximately $76 million of statutory capital and surplus.
Aspida will acquire the insurer for approximately $75 million in cash. Following closing, the company will operate under the Aspida brand.
“The launch of Aspida Financial and its plan for growth is the next evolution of Ares’ existing insurance platform, Ares Insurance Solutions, which now has over 100 insurance investors with $15 billion in assets invested across our products,” said Michael Arougheti, Chief Executive Officer and President of Ares.
“We are excited to expand our presence in the growing insurance sector and to utilize Ares’ extensive capabilities for our first control acquisition of an insurance company that we can grow organically through new distribution channels and potentially inorganically through reinsurance and acquisitions.”
“We have strong conviction that Ares can use its breadth, experience and scale to help Aspida become a market-leading insurance company.”
The launch of Aspida and its acquisition of the Company is believed to represent a natural expansion of Ares’ existing insurance platform, which includes approximately $15 billion of assets in various strategies across more than 100 insurance clients.
“The expansion of our insurance platform reflects our fundamental belief in the long-term growth prospects of protection, savings and retirement income products for individuals and institutions,” said David Reilly, Partner and Head of Ares Insurance Solutions.
“We believe that success in this market is directly tied to prudent and differentiated asset management and we look forward to using our experienced team to drive value.
“We see tremendous growth potential for Aspida in primary fixed and fixed indexed annuity distribution, opportunistic reinsurance transactions and inorganic growth via acquisitions in the insurance sector.”
Aspida’s acquisition of Pavonia Life Insurance Company of Michigan is expected to close before the end of 2019, subject to regulatory approval and other closing conditions.