Fosun has been approaching potential buyers of its run-off business SunPoint as it looks to exit the legacy sector just over two years after it entered, The Insurance Insider can reveal.
The legacy acquirer and services business was founded by former Enstar US chief Karl Wall with financial backing from the Chinese conglomerate.
Sources said Wall is likely to favour replacing Fosun’s financial backing with money from a private equity house.
It is not clear at this stage how far efforts to secure a deal have progressed.
Fosun has developed extensive overseas interests in insurance since it helped found Hong Kong-based reinsurer Peak Re in 2010.
It also bought US insurer Meadowbrook for $433mn in 2015 and three insurers owned by Portuguese state bank insurer Caixa Geral de Depositos in 2014 for EUR1.2bn ($1.1bn).
Its biggest move in specialty insurance was the acquisition of the outstanding 80 percent of Ironshore in 2015, but it subsequently divested that business to Liberty Mutual for $3bn after coming under ratings agency pressure.
Since it was founded in 2017, SunPoint has agreed a $126mn loss portfolio transfer with Aspen relating to its US primary casualty business.
It also agreed services deals with sister company Meadowbrook and ProSight, for which it manages a $50mn run-off book.
Last April, Richard Harris – who served as Enstar CFO for more than a decade – joined SunPoint as a non-executive director.
The Insurance Insider initially revealed that Fosun and Wall were working on the creation of a legacy platform together in December 2016.
At that time, a statement from Wall and Fosun said they would look to expand the platform "with the right balance of volume, discipline and mix of discontinued lines of non-life business" across the UK, European, Asian and US markets.
“The goal is to build a sound foundation to serve the needs of entities seeking run-off solutions for their long-term legacy business,” the statement continued.
Wall left Enstar in 2013 and subsequently founded founded Aylesbury Insurance Services, a consolidation vehicle for US legacy liabilities, before pivoting to lead Fosun’s run-off drive.
Over the last two years, the legacy market has seen more capital formation than flight, with Apollo buying a majority position in Catalina, Aquiline acquiring Armour and injecting capital to create a balance sheet and Darag securing new backing from Aleph and Crestview.
SunPoint and Fosun did not respond to requests for comment.