Hamilton, Bermuda-based insurer XL Capital, Ltd., said it has closed its deal with Syncora Holdings Ltd. (formerly Security Capital Assurance Ltd. The name was changed on Aug. 4) that sever XL ties with its former guaranty insurer and ensure Syncora's financial viability.
Under the deal, announced July 28 by XL Capital and New York State Insurance Superintendent Eric Dinallo, who helped negotiate the transaction, XL Capital, the former parent of Syncora's XL Capital Assurance Inc. and XL Financial Assurance Ltd., (now called Syncora Guarantee Inc. and Syncora Guarantee Re Ltd., respectively) will pay up to $2 billion in combination cash and stock. In return XL terminates, commutates or restructures financial guarantee and reinsurance arrangements with Syncora.
The move leaves Syncora with $1 billion in surplus, moving it from close to insolvency to a solvent insurer, Mr. Dinallo said.
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