US title insurance company, Fidelity National Financial, Inc. (FNF) and F&G, a provider of annuities and life insurance, have announced that F&G has reached an agreement to sell F&G Reinsurance Ltd (F&G Re) to Aspida Holdings Ltd., an indirect subsidiary of Ares Management Corporation.
F&G Re is the Bermuda domiciled reinsurance arm of F&G, with approximately $2 billion in invested assets as of the end of the second-quarter. The company is a provider of reinsurance solutions to third-party life and annuity firms.
An announcement on the deal notes that it is consistent with F&G’s strategic focus on its core retail franchise and growing presence in the bank and broker dealer channel. It’s expected that proceeds from the sale of the reinsurer will be used for general corporate purposes, including funding growth at F&G.
In relation to the definitive agreement, F&G and Aspida are set to enter into a flow reinsurance arrangement with respect to F&G’s MYGA products on a coinsurance fund withheld basis. This reinsurance is arrangement is expected to enhance F&G’s competitive position in both new and existing channels.
The deal is expected to close in the final quarter of 2020, and remains subject to customary closing conditions and regulatory approval. While the financial terms of the deal have not been disclosed, it’s expected that the sale will not have a material impact on FNF’s GAAP financial results.
Chris Blunt, President and Chief Executive Officer (CEO) of F&G, commented: “We are pleased to announce the sale of F&G Re, our third-party offshore reinsurance platform.
“The Transaction represents a terrific outcome for F&G Re, its clients and employees, and FNF shareholders. We look forward to our partnership with Aspida in this important transaction.”