Canopius strikes deal to acquire AmTrust at Lloyd’s

Acquisitive Lloyd’s player Canopius has agreed a preliminary deal to acquire AmTrust at Lloyd’s, The Insurance Insider can reveal. 

Sources said a letter of intent was signed yesterday and will see Canopius take on AmTrust’s managing agency and all of its syndicates, as well as the attached staff. 

The terms of the agreement to acquire the £500mn+ ($644mn) stamp Lloyd’s business are not known at this stage. 

As previously reported, AmTrust had also been running an accelerated process as it looked for a legacy counterparty to take on the 2016 and prior years of account for four of its syndicates. 

With the Canopius transaction believed to exclude this £500mn+ back book, it seems likely that AmTrust is close to a parallel deal to secure finality on the legacy piece. 

On 29 January, this publication said that Enstar – a minority investor in AmTrust – was thought the likeliest acquirer of the back-book if AmTrust proceeded with a sale.  

After a sharp downturn in market-wide results, AmTrust is the latest large corporate to either retreat from Lloyd’s or to signal its intention to do so. This list includes ProSight, The Hanover, American Financial Group and ProAssurance. 

AmTrust has made significant losses since it joined the Lloyd’s market in 2012 after creating a business via acquisition which was effectively a merger of four separate entities – Sagicor, Jubilee, Flagstone and Doré. 

Sources said the firm was also unhappy at the high cost of trading in London and the heavy burden of regulation. 

The transaction will make Canopius, which is backed by private equity house Centerbridge, one of the biggest players in the Lloyd’s market with a stamp believed to be in the region of £1.5bn. 

Canopius also went deep into the recent Pembroke sales process, but exclusivity was ultimately awarded to Hamilton Insurance Group and it seems likely that a deal will follow.  

Canopius declined to comment. AmTrust did not immediately respond to a request for comment.