Swiss Re Insurance-Linked Fund Management

Original Risk: A Society for Change Agents

TransRe, management, increase shares in ILS manager Pillar Capital


Shareholders Transatlantic Holdings, Inc. (TransRe) and the executive management of Bermuda-based insurance-linked asset manager Pillar Capital Holdings Limited have increased their ownership position in the firm to 50% each.

The move brings the combined ownership of Pillar Capital 100% under the control of the firms management and TransRe, the property and casualty reinsurer arm of Alleghany Corporation. At the same time as increasing its management share to 50%, TransRe has reportedly increased its investment commitment to the Pillar funds as well.

Stephen A. Velotti, Chief Executive Officer of Pillar commented; “The consolidation of our ownership structure puts us in an excellent competitive position by increasing the commitment of an exceptional sponsor in TransRe, while enabling Pillar to maintain its independent management platform.  The combination enables us to focus on our mission: delivering value to investors in an increasingly complex reinsurance landscape.”

Michael C. Sapnar, President and Chief Executive Officer of TransRe added; “We are delighted to strengthen our commitment to Pillar.  Having been invested in Pillar since its formation in 2008, we’ve been pleased with Steve and his team’s underwriting discipline and their track record of results.  In addition to increasing our ownership stake, we have also extended TransRe’s multiple-year commitment to invest in the Pillar funds.”

Alleghany, through the TransRe investment in Pillar Capital, has increasingly enjoyed Pillar Capital’s contribution to Alleghany results in recent quarters. With the firms ownership stake now grown and an increased and extended commitment made to Pillar’s ILS funds, Alleghany is well-positioned to enjoy an even greater contribution from ILS and third-party capital to its bottom line.

When Pillar Capital added TransRe as a key shareholder the firm also counted Marsh & McLennan Companies and Aquiline Capital Partners LLC as managing investors at that time. Marsh & McLennan and Aquiline had bought into Pillar Capital when it transitioned from being Juniperus Capital, its former name.

With TransRe and the Pillar Capital management team now taking 100% ownership it transpires that Marsh & McLennan and Aquiline have sold down their ownership stake in the ILS manager, Aquiline having done so in late 2013. This positions TransRe and Alleghany as sole external management shareholder giving them a great platform to build on their use of third-party capital while Pillar Capital gets a strong and dedicated partner to help it grow.

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