Tower Group International, Ltd., has entered into an agreement to acquire American Safety Reinsurance, Ltd. (“ASRe”), the Bermuda-based reinsurance subsidiary of American Safety Insurance Holdings, Ltd. (“ASI”), from Fairfax Financial Holdings Limited for approximately $59 million.

The purchase of ASRe is expected to close in the second half of 2013, following the completion of Fairfax Financial's acquisition of ASI. Following the close of the transaction, the operations and employees of ASRe will be combined with Tower's Bermuda reinsurer, Tower Reinsurance, Ltd.

“The acquisition of ASRe enables us to diversify and expand our specialty reinsurance business and clients as well as to accelerate our development of our newly formed Bermuda reinsurance business platform needed to support this growing business,” said Michael H. Lee, Tower's president and chief executive officer. “ASRe's specialty casualty-focused reinsurance business will complement and further diversify Tower Re's existing business, which is primarily comprised of qualifying quota share reinsurance treaty business for Lloyd's syndicates and property retrocessional excess quota share business underwritten with select partners. We will also benefit from the addition of ASRe's experienced casualty underwriting, support staff and extensive network of reinsurance brokers and specialty insurance company clients in the U.S. We expect this acquisition to generate approximately $40 million of premiums and be modestly accretive to Tower's earnings in 2013, with a growing profit contribution beginning in 2014.”