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Enstar Group (ESGR) to Sell Affiliate to Global Bankers Unit
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Enstar Group Limited (ESGR - Free Report) recently entered into an agreement to sell its subsidiary Pavonia Holdings (US), Inc. to an affiliate of Global Bankers Insurance Group (“Global Bankers”), the insurance and reinsurance group of companies of Eli Global, LLC. The total consideration will amount to $120 million. The divestiture, pending regulatory approvals, is expected to culminate in the third or fourth quarter of 2017.
In 2013, Enstar Group purchased the Pavonia Holdings from HSBC Finance. Interestingly, Pavonia is the owner of Pavonia Life Insurance Company of Michigan, Pavonia Life Insurance Company of New York as well as Enstar Life (US), Inc.
The multi line insurer has been able to demonstrate enhanced and effective systems owing to the acquisition of the Pavonia business, which in turn, have fueled solid contributions to Enstar Group. Moreover, the buyout boosted the value of Pavonia Holdings.
On the other hand, the agreement is an important milestone in the execution of Global Bankers’ strategy. Pavonia Holdings’ long duration liabilities, especially structured settlements, will be a perfect fit for Global Bankers’ investment abilities. Further, the talented team at Pavonia Holdings and the efficient platform provided by it will improve Global Bankers’ operational capacity.
Notably, completion of this transaction will mark Global Bankers’ sixth and largest insurance company buyout since 2014. The closing of this deal will highlight Global Bankers’ commitment to the life and annuity sector.
Shares of Enstar Group gained 24.72% in the last one year, underperforming the Zacks categorized Multi line industry’s growth of 30.82%. Nonetheless, we believe that strategic initiatives like the one mentioned above, robust premiums and investment income performance will help the stock to turn around in the near term.
American Equity Investment develops and sells fixed index and fixed rate annuity products in the U.S. The company delivered a positive surprise in one of the last four quarters but with an average negative surprise of 39.14%.
James River Group offers specialty insurance and reinsurance services in the U.S. The company delivered positive surprises in three of the last four quarters with an average beat of 3.60%.
Primerica distributes financial products to middle income households in the U.S. and Canada. The company delivered positive surprises in three of the last four quarters with an average beat of 5.61%.
The Allstate Corporation deals in property-liability insurance and life insurance business in the U.S. and Canada. The company delivered positive surprises in all of the last four quarters with an average beat of 16.34%.
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Enstar Group (ESGR) to Sell Affiliate to Global Bankers Unit
Enstar Group Limited (ESGR - Free Report) recently entered into an agreement to sell its subsidiary Pavonia Holdings (US), Inc. to an affiliate of Global Bankers Insurance Group (“Global Bankers”), the insurance and reinsurance group of companies of Eli Global, LLC. The total consideration will amount to $120 million. The divestiture, pending regulatory approvals, is expected to culminate in the third or fourth quarter of 2017.
In 2013, Enstar Group purchased the Pavonia Holdings from HSBC Finance. Interestingly, Pavonia is the owner of Pavonia Life Insurance Company of Michigan, Pavonia Life Insurance Company of New York as well as Enstar Life (US), Inc.
The multi line insurer has been able to demonstrate enhanced and effective systems owing to the acquisition of the Pavonia business, which in turn, have fueled solid contributions to Enstar Group. Moreover, the buyout boosted the value of Pavonia Holdings.
On the other hand, the agreement is an important milestone in the execution of Global Bankers’ strategy. Pavonia Holdings’ long duration liabilities, especially structured settlements, will be a perfect fit for Global Bankers’ investment abilities. Further, the talented team at Pavonia Holdings and the efficient platform provided by it will improve Global Bankers’ operational capacity.
Notably, completion of this transaction will mark Global Bankers’ sixth and largest insurance company buyout since 2014. The closing of this deal will highlight Global Bankers’ commitment to the life and annuity sector.
Shares of Enstar Group gained 24.72% in the last one year, underperforming the Zacks categorized Multi line industry’s growth of 30.82%. Nonetheless, we believe that strategic initiatives like the one mentioned above, robust premiums and investment income performance will help the stock to turn around in the near term.
Other Stocks to Consider
Investors interested in stocks from the insurance industry can consider American Equity Investment Life Holding Company (AEL - Free Report) , James River Group Holdings, Ltd. (JRVR - Free Report) , Primerica, Inc. (PRI - Free Report) and The Allstate Corporation (ALL - Free Report) . Each of the stocks holds a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
American Equity Investment develops and sells fixed index and fixed rate annuity products in the U.S. The company delivered a positive surprise in one of the last four quarters but with an average negative surprise of 39.14%.
James River Group offers specialty insurance and reinsurance services in the U.S. The company delivered positive surprises in three of the last four quarters with an average beat of 3.60%.
Primerica distributes financial products to middle income households in the U.S. and Canada. The company delivered positive surprises in three of the last four quarters with an average beat of 5.61%.
The Allstate Corporation deals in property-liability insurance and life insurance business in the U.S. and Canada. The company delivered positive surprises in all of the last four quarters with an average beat of 16.34%.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time? Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>