Specialty insurer and reinsurer, Argo Group International Holdings Ltd., has confirmed that it received $30 million at the closing of its sale of Ariel Re to private equity investors Pelican Ventures and J.C. Flowers & Co.
It was announced earlier today that the two private equity investors have now completed their takeover of Ariel Re, which had been part of Argo Group since 2017.
In confirming the finalisation of the deal, Argo Group has revealed that under the terms of the transaction, it received $30 million at closing. Noting that as previously disclosed, Pelican Ventures and affiliates will capitalise the 2021 year of account, with Argo remaining responsible for all years 2020 and prior.
So, the deal, which was first announced in early November, sees Argo maintain responsibility for all of Ariel Re’s legacy business, meaning it’s only the go-forward operations of the reinsurer that it’s now sold.
“This is an important milestone for Argo Group as we simplify our operations – primarily as a U.S.-focused specialty insurer. We are pleased to complete this transaction and appreciate the time and attention provided by Pelican Ventures and J.C. Flowers & Co., as well as the collaboration with our regulators,” said Kevin J. Rehnberg, Chief Executive Officer (CEO) of Argo Group.
Argo states that the transaction will be reported in its fourth-quarter 2020 financial results, adding that the impact to GAAP book value is expected to be immaterial.
