Imagine Insurance Co. Ltd. and Imagine International Reinsurance Ltd. (collectively Imagine) has seen its rating outlook revised to negative from stable by Fitch Ratings, after the sale of one of the company's subsidiaries to bermuda-based Max Capital Ltd.

Fitch currently rates both with an insurer financial strength (IFS) rating of 'A-'.

The revised outlook reflects Fitch's concerns about the effect on Imagine's competitive positioning and operating profile from the organisation's pending sale of Imagine's subsidiary Imagine Group (UK) Ltd.

On Thursday, Max announced it had entered into a definitive agreement to buy Imagine UK from Imagine in exchange for an approximate $22 million cash consideration.

Imagine UK's key assets include three Lloyds underwriting syndicates.

In recent years, Fitch had viewed these syndicates, which provided access to a wide variety of business lines, as an important part of Imagine's overall underwriting platform and business strategy.