AJG’s Artex to acquire Horseshoe, creating predominant ILS service firm

Artex Risk Solutions is set to acquire Horseshoe, the Bermuda-headquartered specialist ILS, insurance or reinsurance management and fund administration, servicing, and risk transformation specialist, creating a dominant ILS service firm that will operate under the Horseshoe brand.

Of course the pair do much more than just service insurance-linked securities (ILS) transactions, but clearly that’s our focus area.

Artex is a subsidiary of insurance and reinsurance brokerage Arthur J. Gallagher & Co. and leading insurance and reinsurance linked securities (ILS) market service provider, offering clients a range of alternative risk transfer and insurance management services, ranging from reinsurance transformers, to segregated cell structures, captives and other solutions that specifically target the collateralised reinsurance and ILS market.

Horseshoe meanwhile, the business founded in 2005 and built up under the leadership of Andre Perez, offers services across five main business areas, encompassing Insurance Management, Reinsurance Transforming using its Horseshoe Re vehicle, Fund Administration, as well as Corporate and Advisory Services.

So there is a relatively significant degree of overlap between the two, with the pair likely often having competed for business in the past, but also some differences such as the fund administration offering that Horseshoe has also developed and its leading work in risk transformation.

Horseshoe is now set to become the global brand behind the ILS service offering of Artex, with the combined entity operating as one global team across the multiple jurisdictions they serve.

This is expected to enable better service for clients consistent delivery of the offering, regardless of the domicile operated or transacted in.

Bringing the pair together creates a predominant service provider to the ILS and collateralised reinsurance sector, with the majority of ILS funds, ILS investors and reinsurance firms leveraging third-party capital, likely to be working with one of the pair in some direct or indirect capacity.

Arthur J. Gallagher & Co., Artex’s parent, has just announced the agreement to acquire Horseshoe Insurance Services Holdings Ltd., with the acquisition still subject to regulatory approval and expected to close in the fourth quarter of 2019.

“Horseshoe Insurance Services brings us deep market expertise and service offerings within the ILS market – a critical business segment – which will enhance the value we deliver to our existing client base,” explained J. Patrick Gallagher, Jr., Chairman, President and CEO of Arthur J. Gallagher & Co. “I would like to extend a warm welcome to Andre and his associates on behalf of our growing global team.”

“The Horseshoe team shares our company’s deep culture of innovation, teamwork and responsive customer service. Together, we have the opportunity to solidify our market-leading position as the largest provider of solutions to the ILS market,” added Peter Mullen, CEO of Artex. “At Artex, we are proud to be ranked as the world’s third largest insurance manager. The addition of Horseshoe will position us to continue evolving and pushing the boundaries of what a global, top-tier insurance provider looks like.”

“We are excited to join forces with Artex and Gallagher. For more than 14 years Horseshoe has been the leader in the ILS services industry. Being part of a larger organization will give us the opportunity to access worldwide resources and accelerate the development of bespoke solutions and products for ILS,” commented Andre Perez, CEO of Horseshoe. “Our goal has and will always be to add value to our clients. Together we will have quite a formidable team dedicated to the ILS market.”

Horseshoe is the largest independent company that provides insurance management, fund administration, advisory and corporate services to the insurance-linked securities (ILS) market.

Headquartered in Bermuda and with offices in London, Cayman, Sri Lanka and Charlotte, N.C., Horseshoe has also developed in-house technology solutions that enhance its customer offering and support clients operating in the ILS segment.

Following the acquisition, Andre Perez and his team will continue to operate from current office locations under the direction of Peter Mullen, CEO of Artex Risk Solutions.

Given the specialist nature of the services these firms provide to the ILS market, one acquiring the other creates a predominant provider of management, advisory, administration and corporate services to the insurance-linked securities (ILS) market.

Of course, it does also shrink the range of service providers available somewhat, but as the ILS market grows having robust providers of these vital services is key and the combined offering under the Horseshoe brand and under the AJG umbrella, will be a powerful proposition going forwards.

“The combination of the Artex and Horseshoe teams and technology will provide our clients with the opportunity to find all insurance management, fund administration and advisory services under one roof,” added Mullen. “Andre and his team mirror our culture at Artex. They will be a terrific fit and will help further our goal of becoming the best service provider to the world’s risk capital.”