Core Specialty announced today that it has completed the recapitalisation of StarStone U.S.. The recapitalisation was led by the investors - SkyKnight, Dragoneer Aquiline. Enstar has received a combination of cash consideration and shares in Core Specialty as part of the recapitalisation.
The $610 million in new equity capital provided by the Investors, together with the rollover of Enstar’s existing ownership, and an additional equity purchase of over $60 million from management and selected other investors, will increase the equity capitalization of the Company to over $900 million.
After giving effect to the recapitalization, SkyKnight and Dragoneer will each have beneficial ownership of approximately 27%, Enstar 25%, Aquiline 11%, management and Directors 6% and other investors 4%.
Loss Portfolio and Adverse Development Cover
In conjunction with the capital infusion, one of Enstar’s wholly owned subsidiaries has entered into a combination loss portfolio and adverse development cover reinsurance agreement with the Company.
New Management Team and Board of Directors
As part of the capital infusion, Core Specialty has appointed a new management team and Board of Directors. Jeff Consolino will be President & CEO and Ed Noonan will be Executive Chairman. The Core Specialty Board of Directors will include Messrs. Noonan and Consolino; Paul O’Shea and Robert Campbell from Enstar; Steve DeCarlo; Dom Addesso; Don Larson; Matthew Ebbel, Managing Partner of SkyKnight; Marc Stad, Managing Partner of Dragoneer; and Chris Watson, Partner of Aquiline. The additions of Messrs. Addesso and Larson have not been announced previously. Each of the members of Core Specialty’s Board of Directors have an exceptional track record of building successful businesses.
Jeff Consolino is an accomplished insurance industry leader with more than 28 years of sector experience. Most recently, Jeff was Executive Vice President, Chief Financial Officer and a Director of American Financial Group, Inc. (“AFG”). He was previously a founding executive of Validus Holdings, Ltd. (“Validus Group”) where he served as President & Chief Financial Officer and a Director.
Ed Noonan brings more than 40 years of industry experience to the Company. He served most recently as Chairman and CEO of Validus Group, a position he held from 2005 to 2018. Under Mr. Noonan’s and Mr. Consolino’s leadership, Validus Group experienced significant growth from its start-up formation. Validus ultimately was acquired by AIG in 2018 after more than a decade as a leading independent public company with Mr. Noonan as CEO. Mr. Noonan also served as President and CEO of American Re from 1997 to 2002, after joining the firm in 1983.
Rebranding as Core Specialty
Core Specialty’s vision is to become the leading specialty insurer. The new name represents the company’s purpose – to be the core, or most important part, of their clients’ businesses, and their commitment as a specialist to niche insurance markets. These foundational elements of the brand, combined with a striking visual expression and vibrant new logo, comprise an identity that conveys a bold energy and an inspired confidence.
Commenting on the rebranding, Mr. Consolino said “Core Specialty has the expanded capital to take on risk, the underwriting talent in place, a proven and decisive leadership team and a track record of making things happen fast. Collectively and in each of our specialist niche business units, we intend to operate with strong entrepreneurial spirit and drive, speed, agility, and empowered decision-making.”