Arch Capital to Acquire Ariel Re’s Credit & Surety Reinsurance Operations

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The selloff of various parts of Ariel Re continues, as Arch Capital announced that it will acquire Ariel Re’s Credit & Surety reinsurance operations based in Zurich. The news follows an earlier announcement that Goldman Sachs is acquiring Ariel Re’s Bermuda operations.

Arch explained that upon the closing of the transaction, Ariel Re’s Zurich based team will transfer to the Zurich office of Arch Reinsurance Europe Underwriting Limited (Arch Re Europe) and “will be fully operational with immediate effect, ensuring a seamless transition for service to both clients and intermediaries.” Ariel Re’s existing Trade Credit & Surety portfolio will be reinsured by Arch Reinsurance Ltd. (Arch Re Bermuda).

The closing of the transaction is subject to regulatory approvals and other customary closing conditions

The effect of Ariel Re’s sell-off of a significant portion of its business to Arch and Goldman Sachs (Arrow) has been commented on by both A.M. Best and Standard & Poor’s Rating Services. Best affirmed the companies’ ratings and stable outlook; while S&P put Ariel Re on its CreditWatch “with negative implications,” indicating a possible downgrade for the company.

Marc Grandisson, Chairman and CEO of Arch Worldwide Reinsurance Group, noted that adding a “highly experienced and successful team to our group furthers our strategy to become a lead capacity and service provider in specialty lines where we see a proven record and opportunities for growth.”

Thomas Rothenberger, currently Head of Credit and Surety at Ariel Re, who will continue to lead the team upon its move to Arch, stated: “We are excited to join a reinsurance company of this caliber and believe that Arch’s outstanding capital position, deep experience and knowledge of this business line and risk culture provides us with an excellent opportunity to guarantee continuity to our clients and further grow our business.”

Source: Arch Capital Group

Topics Mergers & Acquisitions Reinsurance

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