Brookfield deal will drive Argo 'to new heights': Bradley
Investment firm Brookfield Reinsurance is buying Argo for $30 a share in a deal that concludes Argo’s strategic review process, which has already seen the Bermuda-based group sell its Lloyd’s operation
Activist shareholder Voce backs $1.1bn merger, which will see Argo form the ‘core’ of Brookfield Reinsurance’s US commercial lines platform
Argo Insurance’s $1.1bn acquisition by Brookfield Reinsurance will allow the company to grow into a “market-leading specialty insurer” in the US admitted and excess and surplus (E&S) lines markets, the carrier’s chairman and chief executive said.
In a letter to staff, Tom Bradley said the Bermuda-based carrier would form the “core” of Brookfield’s US property/casualty (P&C) insurance platform. He added the deal would enable the firm to “reach new heights”.
“It has become clear through our conversations with the Brookfield Reinsurance team they value the talent in our organisation, our relationships with our distribution partners and all we can provide to their growing P&C operations,” Bradley said.
“Leveraging Brookfield Reinsurance’s competitive advantage in asset origination and existing operational footprint, we expect to scale Argo into a market-leading specialty insurer with capabilities across the admitted and E&S markets,” he added.
On February 8, investment firm Brookfield announced an agreement to acquire Argo for $30 per share, representing a 6.7% premium to the firm’s closing share price on February 7.
The transaction, which must be approved by shareholders, concludes Argo’s strategic review process, which has already seen the Bermuda-based group sell its Lloyd’s operation.
Activist shareholder Voce Capital Management, which owns a 9.47% shareholding in Argo, has agreed to vote in favour of the merger, according to Securities and Exchange Commission filings. Voce has been pushing for changes in Argo’s operations for several years.
The filings also revealed Argo will pay Brookfield Reinsurance a termination fee of up to $37.2m if it terminates the merger.
The merger is expected to close in the second half of 2023.
