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HAMILTON, Bermuda, Sept. 6, 2012 (GLOBE NEWSWIRE) -- Enstar Group Limited (Nasdaq:ESGR) today announced that it has entered into a definitive agreement under which Enstar will acquire all of the shares of Household Life Insurance Company of Delaware and HSBC Insurance Company of Delaware from Household Insurance Group Holding Company, an affiliate of HSBC Holdings plc.
The companies to be acquired have written various U.S. and Canadian life insurance, including credit insurance, term life insurance, assumed reinsurance, corporate owned life insurance, and annuities.
Enstar expects to finance the purchase price through a combination of cash on hand and a drawing under its revolving credit facility. The base purchase price of $181 million will roll forward under the terms of the stock purchase agreement based upon changes to the capital and surplus of the acquired entities arising from the operation of the business prior to closing. Completion of the transaction is conditioned on, among other things, governmental and regulatory approvals and satisfaction of various customary closing conditions. The transaction is expected to close by the end of the first quarter of 2013.
"Whilst our core focus remains non-life property and casualty run-off, we are excited to further expand our portfolio of run-offs with this acquisition of closed-life insurance business from HSBC," said Dominic Silvester, Chief Executive Officer of Enstar. "We recognize the confidence they are putting in Enstar by entrusting the insurance policies of their own customers to us. We have been studying closed-life insurance for a number of years – including through our small acquisition of Laguna Life Limited in 2011 – and we have expanded our knowledge and understanding of this business, which we see as an enhancement to our global run-off strategy."
Enstar, a Bermuda company, acquires and manages insurance and reinsurance companies in run-off and portfolios of insurance and reinsurance business in run-off, and provides management, consultancy and other services to the insurance and reinsurance industry.