Berkshire merges Euclidian with Marlborough
Euclidian, the Berkshire Hathaway backed insurance company, will merge with fellow Lloyd’s agency, Marlborough Underwriting.
Berkshire Hathaway is thought to have exercised its right to acquire Euclidian’s holding company EUC Re from Capital Insurance Holdings for £1. At the time of going to press, It is unclear what impact this may have on Euclidian’s underwriting in 2005 although it may mean the end of Euclidian’s merger talks with fellow Lloyd’s insurer Canopius, first revealed in The Insurance Insider’s sister publication Insider Week.
Euclidian’s future has been uncertain following the failure of ambitious Lloyd’s consolidation vehicle Capital Insurance Holdings to float on the Alternative Investment Market. Capital was created by Berkshire Hathaway as a medium to sweep up small, quoted Lloyd’s insurers into a large £1bn-£2bn UK plc which, it was hoped, would attract greater investor interest. If Capital succeeded it would have raised sufficient funds to provide Euclidian with permanent capital.
Euclidian’s Syndicate 1243 is currently capitalised with letters of credit - an arrangement Lloyd’s are apparently keen to end.
Capital’s float was postponed when the company failed to attract sufficient UK investor interest. It is also unclear what role Michael Wade - Euclidian’s chairman and a passionate advocate of consolidation at Lloyd’s - will have in the newly merged entity or whether Capital will now dissolve.