R&Q to acquire UK non-life insurance company
R&Q has agreed to acquire RLGI, a UK non-life insurance company in run-off, from The Royal London Mutual Insurance Society.
RLGI underwrote non-life insurance from 1985 to 1999; the remaining liabilities relate to employers’ liability originating from cover provided to small and medium-sized enterprises.
The agreed purchase price is £11.9 million ($15.8 million) and represents a discount to RLGI’s net assets of £13.5 million ($18 million) as at year-end 2015.
The transaction will be financed from the Group’s bank facility and cash at hand. In the year ended December 31, 2015, RLGI reported a profit before tax of £0.8 million ($1.1 million).
Once regulatory approval has been received, the plan is to transfer the acquired business to R&Q Insurance (Malta) Limited. R&Q aims to to complete the transaction by 2017-end.
Ken Randall, chairman and chief executive officer of R&Q, said: "We are delighted to have reached agreement to acquire RLGI and this continues to demonstrate the ability of R&Q to provide exit solutions to owners of insurance companies in run-off. This will be the second transaction where R&Q has provided non-life legacy solutions to the life and pensions sector. We remain excited about our legacy acquisition pipeline.”
