NEW YORK:
Tokio Marine Holdings, Inc. today announced it has reached a definitive agreement to acquire Privilege Underwriters, Inc. (PUI) from investors led by Stone Point Capital and KKR for $3.1bn, the latest move in its multiyear push into the world’s largest insurance market.
At a press conference on Thursday, Satoru Komiya, Tokio Marine’s chief executive, said Pure had little overlap with its existing business in the US, where it has already spent more than $15bn including its $7.5bn deal for Texas-based HCC Insurance Holdings in 2015 and the $4.6bn acquisition of Philadelphia Consolidated in 2008.
Japan’s largest non-life insurance group, with a market value of $38bn, also said it would consider issuing subordinated bonds in addition to using cash to finance the deal, which is expected to be completed by March.
PUI is the holding company for a collection of specialty companies serving the needs of high net worth individuals and families. PUI, which does business through the PURE Group of Insurance Companies (PURE Group), includes: PURE Risk Management, the attorney-in-fact for Privilege Underwriters Reciprocal Exchange (PURE); PURE Insurance Company, a Florida-domiciled stock insurance company; PURE Programs, a managing general underwriter; and Haven Art Group, a fine art services and claims management company.
Each of the PURE Group companies, except the reciprocal insurance exchange, which is an unincorporated association owned by its subscribers, will become wholly owned subsidiaries of HCC Insurance Holdings, Inc.
The PURE Group is one of the leading writers of high net worth insurance in the United States. The company has grown organically by more than 20% in each of the past twelve years and has inforce premiums of more than $1 billion. The PURE Group creates specialized insurance solutions and offers coverages including: Homeowners; Automobile; Personal Excess Liability; Jewelry, Art & Collections; Fraud and Cyber Fraud; Watercraft; and Flood.
The company is headquartered in White Plains, New York with ten offices across the United States. The PURE Group employs approximately 800 people writing business in 49 states and the District of Columbia.
"The PURE Group's member-owned model is unique and forges an alignment of interests focused on delivering a sophisticated insurance solution to carefully selected individuals. This acquisition provides unique growth opportunities and portfolio diversification for the Tokio Marine Group. We look forward to welcoming the PURE Group's management team and employees to Tokio Marine and to helping them continue to grow this business post-transaction," said Chris Williams, Senior Managing Executive Officer and Co-Head of International Business for Tokio Marine Holdings, Inc.