This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Arch Capital Group Ltd. To Enter U.S. Mortgage Insurance Market Through Acquisition Of CMG Mortgage Insurance Company And The Operating Platform Of PMI Mortgage Insurance Co.

Stocks in this article: ACGL

Marc Grandisson commented, “We are very gratified that PMI’s exceptionally strong management team and staff will be joining Arch. Together with our senior executives, they will form an industry leading team with broad capabilities to meet our clients’ needs over the long term. We are also extremely pleased to partner with CUNA Mutual on an ongoing basis. Their access to the credit union marketplace and brand reputation should allow us to secure a strong flow of credit union business.”

“The petition being filed for court approval of this agreement is a significant milestone and positive step in the PMI receivership,” said Germaine L. Marks, Director of the Arizona Department of Insurance. “The successful negotiation of this transaction clearly evidences Arch's commitment to the private mortgage insurance market, and the PMI receivership team looks forward to building on that commitment and our relationship with Arch as we move forward.”

Additional Transaction Highlights

Outlined below are some of the key components of the transaction, all of which are subject to the terms and conditions included in the related agreements:

  • At closing, it is currently estimated that Arch U.S. MI and its affiliates will pay to the sellers aggregate consideration of approximately $300 million. Additional amounts may be paid based on the actual results of CMG MI’s pre-closing portfolio over an agreed upon period.
  • Arch U.S. MI will acquire all of the capital stock of CMG MI and its affiliates.
  • Arch U.S. MI will acquire PMI’s mortgage insurance operating platform and related assets.
  • An affiliate of Arch U.S. MI will reinsure the run-off of in-force insurance on current, non-delinquent loans included in the primary mortgage insurance originated by PMI for book years 2009-2011. Other than for the risks assumed by Arch U.S. MI’s affiliate under this reinsurance agreement, the Arch group will not assume any obligation for risks insured under PMI’s existing insurance contracts.
  • Arch U.S. MI will also enter into a services agreement with PMI to provide for necessary services to administer the run-off of PMI’s legacy business at the direction of PMI.
  • Subject to applicable regulatory and GSE approvals, an affiliate of Arch U.S. MI will provide quota share reinsurance to CMG MI through a reinsurance agreement that will become effective prior to the closing.

About Arch Capital Group Ltd.

Arch Capital Group Ltd., a Bermuda-based company with approximately $5.75 billion in capital at September 30, 2012, provides insurance and reinsurance on a worldwide basis through its wholly owned subsidiaries.

2 of 4

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs