TransRe acquires minority stake in Pillar Capital
Transatlantic Holdings Inc, a unit of Allegheny Corp, has become a minority owner of Pillar Capital Holdings, a Bermuda-based insurance asset manager focused on collateralised reinsurance and catastrophe insurance-linked securities (ILS).
TransRe joins Marsh & McLennan Companies, Aquiline Capital Partners as Pillar Capital backers. In addition to acquiring a minority stake in the company, TransRe has made a multiple-year commitment to invest in Pillar’s insurance-linked funds.
Pillar says it has strong institutional support and its ILS products offer low correlation to traditional asset classes and a favourable liquidity profile relative to many other types of alternative investments.
“We look forward to working with TransRe and our other partners as we develop first-class investment opportunities in the reinsurance space for our investors,” said Chris McKeown, CEO of Pillar.
“The market demand for well-qualified independent third-party managers of property catastrophe risk from institutional investors continues to be high. After considering a variety of ways to participate in this trend, we chose to partner with Pillar,” said Michael Sapnar, CEO of TransRe.
“We’ve known the Pillar team for some time and believe they are well-positioned to build a leading asset manager for insurance-linked investments.”
New York-based Alleghany Corporation acquired Transatlantic Holdings for $3.4 billion in November 2011 after a months-long bidding war that drew in offers from Berkshire Hathaway, Allied World Assurance and Validus.
Pillar was formerly Juniperus Capital. No financial terms of the deal between TransRe and Pillar were disclosed.