Enstar buys Argo stake worth $49m ahead of potential sale

Enstar Group has purchased a 3.4% stake in fellow Bermudian re/insurer  Argo Group International Holdings, which is currently on the market for a potential sale, merger or other deal.

Argo announced April 28 that it has retained Goldman Sachs as its financial advisor as the company’s board of directors have initiated an exploration of strategic options to “maximize shareholder value”.

Enstar disclosed in a US Securities and Exchange Commission (SEC) filing Monday (May 02) ownership of 1,188,400 shares of Argo Group with total holdings valued at $49 million ($49,057,152) as of March 31, 2022.

The move makes Enstar the ninth largest shareholder in Argo, after Voce Capital Management, Vanguard Group, BlackRock, Dimensional Fund Advisors, Champlain Investment Partners, Pzena Investment Management, Frontier Capital Management, and Franklin Resources.

Argo is an underwriter of specialty insurance products in the property and casualty market, offering a full line of products and services in two primary segments: US operations and international operations.

Enstar specialises in run-off and legacy solutions through its network of group companies in Bermuda, US, UK, Continental Europe, Australia, and other international locations. It has acquired over 110 companies and portfolios since its formation in 2001.

In the first three months of the year, both Argo and Enstar reported a net loss. Argo slipped to a loss of $3.6 million against a $27.2 million profit a year ago, while Enstar saw a loss of $282 million, compared to net earnings of $183 million in Q1 2021.