Helios Underwriting plc has announced the acquisition of Chapman Underwriting Limited, a limited liability member of Lloyd’s of London, for a cash consideration of £540,000 (roughly US$715,000).
The acquisition comes following approval of change of control by the Lloyd’s of London marketplace, and is in line with Helios’ strategy of increasing underwriting capacity via acquisitions.
Chapman had underwriting capacity in 2017 of £670,000, which compares to Helios’ underwriting capacity for the year of £35.7 million, prior to this takeover. Chapman operates in a number of Lloyd’s syndicates that broadly matches Helios’ existing portfolio. Furthermore, the transaction enables Helios to expand its participation on the better syndicates at the Lloyd’s market.
The acquired capacity, combined with capacity Helios expects to retain for the 2018 underwriting year includes; £620,000 retained for the 2015 year of account, £630,000 retained for the 2016 year of account, £670,000 for the 2017 year of account, and £330,000 for the 2018 year of account. The 2018 year of account also includes £770,000 reinsured, taking total capacity got that year to £1.1 million.
The transaction sees Helios acquire tangible net assets of £404,000, which includes a provision or a loss on the 2017 year of account of 5% at 36 months.
For the year ended 31st December, 2016, Chapman made a pre-tax profit of £48,619 on gross written premiums of £630,000.