Enstar Group and Stone Point Capital LLC today announced they have signed definitive agreements to sell StarStone Underwriting Limited, the Lloyd’s managing agency, together with the right to operate Lloyd’s Syndicate 1301, to Inigo Limited (“Inigo”), a new specialty re/insurance holding company.
Enstar, Stone Point and Dowling funds will receive $30 million of consideration from the sale of SUL in the form of Inigo shares upon closing. In addition, Enstar and Stone Point will commit to invest up to $27 million and $18 million respectively into Inigo.
Inigo is led by founders Richard Watson, Russell Merrett and Stuart Bridges and will operate as a Lloyd’s specialty insurer writing a streamlined portfolio of insurance and reinsurance risks and will receive certain transitional services and staff from Enstar.
In conjunction with the transaction, Enstar, Stone Point and Dowling Capital will retain the economics of Syndicate 1301’s 2020 and prior years’ underwriting portfolios as this business runs off.
The Inigo investment is expected to close in late 2020 and the SUL sale is expected to close in the first half of 2021, subject to regulatory approvals and satisfaction of customary conditions.
Dominic Silvester, Enstar’s Chief Executive Officer, said: “This transaction optimises and capitalises on StarStone International’s assets at Lloyd’s and provides an opportunity to participate in a new venture with proven leadership at a time of favourable market conditions. This is a positive outcome for SUL, and we look forward to working with the Inigo management team as they launch this new business.”
The SUL sale follows the previously announced decision by Enstar and Stone Point to place StarStone’s International business into an orderly run-off and review strategic alternatives for the business. In addition to the SUL sale, Enstar and Stone Point recently agreed to a renewal rights transaction for StarStone’s European Financial Lines business, as well as the sale of Belgian-based underwriting agent Vander Haeghen, part of the StarStone International Group.