AIG Completes $5.5 Billion Acquisition of Validus

July 18, 2018

American International Group Inc. said it has completed its acquisition of Bermuda reinsurer and specialist insurer Validus Holdings.

The $5.56 billion all-cash transaction was first announced in January, about eight months after Brian Duperreault took over at AIG as president and chief executive officer.

Validus adds diversified franchises to AIG including Validus Re, a reinsurance platform; AlphaCat, an insurance-linked securities asset manager; Talbot, a Lloyd’s syndicate; Western World, a specialist in U.S. small commercial excess and surplus underwriting; and Crop Risk Services, which provides access to the North American crop insurance market.

Duperreault said Validus’ “experienced team and complementary businesses” will help AIG “deliver sustainable, profitable growth.”

Peter Zaffino, AIG’s CEO, General Insurance, said the Validus businesses will be immediately accretive to General Insurance.

AIG’s Dealmaker CEO Duperreault Says Validus ‘Fits Like a Glove’

Validus “brings us skills we don’t have,” Duperreault, said in announcing the deal in January.

The Validus deal gives AIG a Lloyd’s of London operation, a business the company exited in 2016.

The acquisition is AIG’s biggest since its 2001 agreement to buy American General Corp. for $23 billion to push further into life insurance, according to data compiled by Bloomberg.

Validus Holdings reported it lost money during the 2018 first quarter, due partly to more expenses, an underwriting loss in its insurance segment and a drop in income for the carrier’s reinsurance arm.

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