View this article online: https://www.insurancejournal.com/news/southcentral/2014/07/31/336332.htm
Stonetrust Commercial Mutual Insurance Holding Co. announced it has agreed to be acquired by Dhandho Holdings LP and Dhandho Holdings Qualified Purchaser LP, based in Irvine, Calif.
Stonetrust is a Louisiana-based mutual insurance holding company and the parent company of Stonetrust Commercial Insurance Co.
Stonetrust Commercial Insurance provides workers’ compensation and employers’ liability insurance coverage to over 5,100 policyholders in Louisiana, Mississippi, Arkansas, Oklahoma and Texas.
The $35 million cash acquisition will include Stonetrust Commercial Mutual Insurance Holding Co., Stonetrust Commercial Insurance Co., and Stonetrust Realty LLC, as well as Stonetrust Management Services LLC, the independently owned managing general agent.
The Stonetrust companies will become subsidiaries of a new stock holding company created by the Dhandho partnership. Stonetrust operations will remain unchanged and continue to be headquartered in Baton Rouge, La., under current President and CEO Tim Dietrich.
The transaction is expected to close within 90 days. It will require approval of policyholders and the Louisiana Department of Insurance. Proceeds of the transaction will be paid to eligible policyholders.
Dhandho has further agreed to infuse an additional $30 million capital contribution into Stonetrust Commercial Insurance Co., thereby doubling total surplus to over $60 million and providing an immediate boost to its premium to surplus ratio. Stonetrust anticipates the additional capital will facilitate its expansion plans and aid the company in achieving its goal of an “A” rating by the global credit rating agency A.M. Best. Stonetrust is currently rated “B++”.
Source: Stonetrust Commercial Insurance Co.