Best Sees No Change in Lancashire’s Ratings from Cathedral Acquisition

A.M. Best Co. has commented that the ratings of Bermuda-based Lancashire Holdings Limited, Lancashire Insurance Company Limited and Lancashire Insurance Company (UK) Limited – collectively known as Lancashire – “remain unchanged following its announcement that it has entered into conditional agreements to acquire the entire issued and to be issued share capital of Cathedral Capital Limited (Cathedral), a privately owned Lloyd’s insurer along with loan notes issued by Cathedral’s subsidiary, Cathedral Capital (Investments) Limited.”

In a separate announcement Best said that it doesn’t anticipate any changes in its ratings for either Cathedral or Lloyd’s Syndicate 2010 incident to their acquisition by Lancashire. In fact Best said the acquisition “will enhance Lancashire’s insurance and reinsurance platform, which will now benefit from its participation at Lloyd’s.

“Additionally, the transaction will provide Lancashire increased flexibility to respond to the changing industry and market environments. Given Lancashire’s excellent consolidated risk-adjusted capitalization, historically strong operating results since inception, experienced management team, comprehensive risk management program and modest financial leverage, the proposed acquisition is not anticipated to adversely impact the financial position of Lancashire.”

The transaction is anticipated to close in the fourth quarter of 2013, subject to regulatory approvals and other customary closing conditions.

Source: A.M. Best

Topics Mergers & Acquisitions