DARAG unveils joint venture, acquisition in US expansion
Malta-based legacy re/insurance acquirer DARAG Group has formed a joint venture and announced the acquisition as it plans to expand in the US.
DARAG and US-based run-off specialist SOBC formed a joint venture called SOBC DARAG, in Delaware, to support DARAG’s expansion into the US and Bermuda/Caribbean run-off markets.
At the same time, SOBC DARAG made its first acquisition, namely of Peachtree Casualty Insurance Company (Peachtree), a Florida domiciled nonstandard auto insurer in run-off. The acquisition of Peachtree is subject to regulatory approval and is expected to close in the third quarter of 2018.
The joint venture and acquisition are part of DARAG’s planned expansion into the US and Bermuda/Caribbean markets, and follow the appointment of Tom Booth as CEO and the completion of a €260 million ($300 million) capital raise by DARAG.
Booth said: “Following our recent announcement of an additional equity commitment of €260 million, DARAG is targeting the US and Bermuda/Caribbean markets through the SOBC DARAG JV. The agreement by SOBC DARAG to acquire a US carrier in run-off and the announcement of our joint venture with SOBC are exciting steps in our continued growth. We are pleased to be partnering with SOBC and see Peachtree as the first of many opportunities to work together in the US and Bermuda/Caribbean.”
Stephanie Mocatta, CEO of SOBC, said: “We are extremely pleased to form this joint venture with DARAG. We have already worked together on the acquisition of Peachtree Casualty Insurance Company and are delighted to announce that we have signed the sale & purchase agreement on this acquisition. SOBC already has a very strong reputation in the US and Bermuda legacy markets. Working with DARAG and its strong capital backing will strengthen this and together we will be able to provide a variety of run-off solutions to a much broader spectrum of companies seeking well priced and innovative solutions for their legacy portfolios.”
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