Ariel Re will become second major Bermudan reinsurer to buy Lloyd's entity

Bermudan reinsurer, Ariel, is set to grab a foothold in Lloyd's after agreeing the takeover of Atrium Underwriting.

Under the terms of the offer, Atrium shareholders will receive 365 pence in cash per share, valuing the Lloyd's insurer at £193.2m.

Don Kramer, chairman and chief executive officer of Ariel, said: “Atrium is a leading Lloyd’s specialist insurer, with a high quality underwriting and management team and a long track record of achieving strong performance under challenging market conditions.

"Atrium’s diversified mix of property and casualty business and access to the Lloyd’s market make it a highly complementary addition to Ariel”

Steve Cook, chief executive officer of Atrium, added: “The board of Atrium has given careful consideration to the available options for the strategic development of the Atrium group; it sees clear long-term advantages in the development of a multi-platform insurance and reinsurance group. However, it recognises that the achievement of this strategy would require considerably greater capital resources than Atrium can currently support on a stand-alone basis.

"Against this background, Atrium’s board believes that there are significant attractions in a strategic combination with Ariel and that the cash offer to be made by Ariel represents excellent value for Atrium shareholders.”

The move follows speculation earlier this year that Ariel was leading the race to buy Lloyd's managing agent, Talbot Underwriting.

It lost out to fellow Bermudan reinsurer, Validus Re.

Meanwhile, Christine Dandridge, active underwriter of Atrium's Syndicate 609 and an executive director of Atrium Underwriting will step down from her active underwriter role, and as a director of Atrium, at the end of this year to take early retirement.

Dandridge will be handing over the active underwriter role on Syndicate 609 to Richard Harries, who has been the energy underwriter and a senior member of Syndicate 609 management since joining Atrium in 1997.