Swiss Re's business unit Admin Re has agreed to acquire Guardian Holdings Europe Limited, the holding company for operations trading under the name Guardian Financial Services (“Guardian”), from private equity company Cinven for £1.6 billion. The acquisition will extend Admin Re's position as a closed life book consolidator in the United Kingdom.
As a result of the acquisition, Swiss Re said in a statement, Admin Re will further diversify its current business and increase its assets and reserves. Closing of the acquisition is subject to regulatory approval and could be completed in early 2016.
Michel M. Liès, Swiss Re's group chief executive officer, said, “This acquisition is an excellent opportunity for Admin Re to further enlarge its successful business and diversify its portfolio. It is proof that we can deliver on our ambitions to seek profitable growth opportunities for Admin Re in the U.K. The expected returns exceed our profitability targets for new business and represent an excellent fit with our group strategy as well as with Admin Re's capabilities and existing infrastructure.”
David Cole, Swiss Re's group chief financial officer, added, “This acquisition is in line with Admin Re's strategic goals as well as with our multi-year financial planning. We will continue to remain well capitalized and our economic solvency ratio will remain comfortably above our risk tolerance. This acquisition is also in line with the Swiss Re group's capital management priorities and, accordingly, does not alter our view of the share buy-back program, which was authorized by our shareholders at the 2015 Annual General Meeting. The transaction is of a scale that was already contemplated when we evaluated the scope of the share buy-back program. The launch of the program remains subject, as previously said, to the availability of excess capital, and any decision to launch it will also take into account other potential business opportunities meeting Swiss Re's strategic and financial objectives and major loss events.”
Swiss Re said that it expects Admin Re to generate around USD1.7 billion of gross cash, including capital synergies, over the first three years. In addition, the assets under management of the Swiss Re Group will increase by £12.5 billion, or approximately 15 percent.
Learn more: www.swissre.com.
Victoria Spears
Victoria Prussen Spears is senior vice president of Meyerowitz Communications Inc., a law firm marketing communications consulting company. A graduate of Sarah Lawrence College and Brooklyn Law School, Ms. Spears was an attorney at a leading New York City law firm before joining Meyerowitz Communications. She may be contacted at [email protected].