Alea has announced that its subsidiary, Alea Europe AG, has completed a deal to sell...
Alea has announced that its subsidiary, Alea Europe, has completed a deal to sell the renewal rights to its reinsurance business to Scor.
The portfolio comprises the sale of the casualty treaty portfolio, which represents a majority of Alea Europe's reinsurance business.
Scor and Alea Europe have agreed to a $10m to $20m deal, comprising a cash payment of 9.5% of gross premiums written on renewed European reinsurance business incepting in 2006 and a further three payments for final reconciliation in 2007.
The consideration is capped at $30m. No assets are being transferred.
For the full year 2004, the book of business subject of the transaction generated $220m in gross premiums written, and underwriting profit of $1.9m before allocation of central corporate expenses and before the impact of aggregate excess contracts and after reserve additions relating to prior year development of $33.2m.
Proceeds will be placed in low risk investments. The remainder of Alea Europe will be placed into run-off.
Mark L Ricciardelli, Alea chief executive, said: “This is the group's third unconnected renewal rights transaction representing in aggregate over 40% of 2004 gross premiums written with a potential total consideration of between $38m and $72m.”
Distribution of proceeds from transactions may be subject to regulatory approval.
