Fosun International Limited has now completed its acquisition of the remaining 80% of Ironshore that it did not already own, helping it to grow its footprint in insurance and reinsurance, as it becomes a more insurance-oriented investment group.
Fosun, a privately held China grown but globally focused investment and asset management conglomerate, wants to follow a Warren Buffett styled approach to business, by making insurance and reinsurance a key part of its overall investment group.
Fosun had already acquired 20% of Ironshore for $464m in 2014, but the firm wanted to take full-control of the business and made an offer to buy the remaining 80% for approximately $1.84 billion.
Fosun has now received all necessary approvals from relevant regulatory authorities in the United States, the United Kingdom and other jurisdictions. As a result, by acquiring the remaining 80% of equity interest, Ironshore has now become an indirect wholly-owned subsidiary of Fosun International Limited.
“Ironshore is pleased to jointly announce the completion of the merger transaction with Fosun, which will enable us to continue to build upon our international specialty platform and enhance our global brand,” commented Kevin H. Kelley, Chief Executive Officer of Ironshore. “Fosun’s financial strength and established investment management approach provides long-term strategic capital to bolster Ironshore’s expansion strategy and further adds to Ironshore’s uniqueness. With our new owner, Ironshore is well positioned for the future as a global insurance industry leader.”
Guo Guangchang, Chairman of Fosun, added; “Ironshore’s excellent team has outstanding managing and underwriting insurance capabilities which are widely recognized in the insurance industry. Ironshore has the capability to provide its clients with comprehensive and quality specialty insurance products.
“The successful completion of this transaction marks a historical milestone for Fosun’s investments in the specialty insurance industry as well as the American financial service sector, which significantly boosts our insurance-oriented comprehensive financial capabilities. As a long-term shareholder of Ironshore, Fosun will always support the autonomous, stable and healthy development of Ironshore while fully leveraging our global insurance platform resources to enhance Ironshore’s competitiveness in the industry.”
Fosun’s insurance platform includes investments in Yong’an P&C Insurance, Pramerica Fosun Life Insurance, Peak Reinsurance, Fidelidade Group, Ironshore and MIG. The Fosun insurance platform covers property & casualty insurance, life insurance, reinsurance, general insurance, labor insurance and specialty insurance with presences in major markets around the world.
The diversified insurance and reinsurance platform will provide Fosun with interesting opportunities to put the long-term capital it earns from re/insurance float to work in its investment holding strategies. Fosun says it is dedicated to bringing its strategy of “Insurance-oriented Comprehensive Financial Capability” to a significantly higher level and that it sees the insurance and reinsurance business as the “critical growth driver” of its business.
“Now and in the coming year, Fosun will strengthen its integration and collaboration efforts, seeking to establish a cross-region and cross-industry global insurance and financial group. We encourage our invested companies to collaborate wherever applicable, seeking to connect them to Fosun’s resources with our global insurance and finance platforms to enhance their competitiveness in their respective industries,” Guo explained.
Fosun appreciates the model that has made Warren Buffett and Berkshire Hathaway so successful. It looks set to try to accumulate premium float in the Buffett way, to boost its investments and stimulate growth with insurance and reinsurance at the heart of the group’s strategy.