The acquisition of the world’s largest insurance-linked securities (ILS) and reinsurance linked investment fund manager Nephila has now been completed by Markel Corporation, positioning Markel itself as now the largest manager of third-party reinsurance capital.
The 100% acquisition of ILS manager Nephila Capital by Markel was announced at the end of August and has been completed on schedule.
The acquisition has cost Markel a total consideration of $975 million, in an all cash transaction that now positions the re/insurer with roughly $19 billion of ILS assets under its entities management, given it also owns retrocession specialist Markel CATCo.
Richie Whitt, Markel’s Co-Chief Executive Officer, commented on the successful acquisition, “With a proven 20-year track record of success, Frank Majors and Greg Hagood have built the industry’s pre-eminent and longest-tenured insurance-linked securities manager. The addition of Nephila to Markel’s insurance, reinsurance, insurtech, fronting, and existing insurance-linked securities capabilities will enhance and strengthen the breadth and depth of Markel’s offerings to policyholders, producers, and investors. We welcome Nephila to the Markel family and fully expect their track record of success to continue.”
Frank Majors, Nephila’s Co-Chief Executive Officer, added, “Markel shares our strategic vision for the future of the insurance markets, and we are excited to join Markel, a company with a similar culture, strategic outlook, and long-term focus. We are looking forward to working with the Markel team and are excited by the possibilities from our combined strengths.”
Greg Hagood, Nephila’s Co-Chief Executive Officer, also said, “As we combine the investment independence of a 20-year, stand-alone insurance-linked securities manager with the additional resources of a well-respected and strongly rated insurer like Markel, we believe this partnership will provide meaningful benefits to our investor base now and in the future.”
Nephila is set to continue its operations as a separate business unit within Markel Corporation, but now with enhanced access to all of the resources that entails, including to long-time program fronting partner State National, which Markel also owns.
As we wrote recently, the acquisition and now ownership of two of the largest specialist reinsurance, retrocession and insurance-linked securities (ILS) fund managers, Nephila Capital and Markel CATCo, as well as as well as program and fronting specialist State National, is expected to be a game changer for Markel Corporation.
The Nephila Capital management team, led by Greg Hagood and Frank Majors, will remain at the firm and operations will continue out of the ILS managers Bermuda, San Francisco, CA, Nashville, TN, and London offices.