Arch to buy Allianz's mid-market, entertainment insurance units for $450 mln

Arch Capital

05/04/2024 15:37

April 5 (Reuters) - Arch Capital Group's  ACGL.O  North
American insurance unit said on Friday it would buy the U.S.
midcorp and entertainment insurance businesses from Allianz
Global Corporate and Specialty SE  ALVG.DE  for $450 million in
cash.
    The deal will help expand Arch's footprint in the middle
market segment — companies smaller than multinational
corporations but larger than typical small businesses — in the
United States.
    After a nearly two-year dry spell, mergers and acquisitions
are bouncing back in 2024 on strong expectations of interest
rate cuts and a rally in the markets.
    "This transaction will enhance our distribution
relationships, broaden our product suite and expand our ability
to participate in these underwriting-intensive middle-market
lines," said Matt Shulman, CEO of Arch Insurance.
    Nearly 500 employees of Allianz are expected to move to Arch
Insurance North America as part of the transaction, the
companies said.
    The deal, expected to close in the second half of 2024, will
need a capital requirement of about $1.4 billion to support the
business.
    Goldman Sachs & Co and J.P. Morgan Securities are acting as
the financial advisers to Arch.

 (Reporting by Pritam Biswas in Bengaluru; Editing by Shilpi
Majumdar)
 ((Pritam.Biswas@thomsonreuters.com))