Ark terminates $200m capital investment deal with White Mountains
Bermuda-based White Mountains Insurance Group and Ark Insurance Holdings have terminated their planned $200 million investment deal.
Ark has opted to cancel White Mountains' commitment to provide up to $200 million of additional capital to support the Lloyd's insurer's expansion plans in the hardening property/casualty market.
The move comes after Ark's wholly owned subsidiary Group Ark Insurance raised $70 million in debt issuance last week via a private placement. Earlier in July and August, Ark issued €39.1 million and $47 million of notes, respectively.
White Mountains acquired a majority stake in Ark in October last year and injected $605 million of fresh equity capital into the company at a pre-money valuation of $300 million, in a move aimed to significantly grow the business.
As part of that deal, White Mountains had agreed to purchase $41 million of shares from Ark's existing owners and committed to contribute up to an additional $200 million of equity capital in 2021.
The additional investment would have meant White Mountains owning a 5 percent higher stake (77 percent) in Ark. However, since Ark has turned down the extra $200 million contribution, White Mountains would own 72 percent of Ark on a basic shares outstanding basis.
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