AIG Closes Validus Acquisition

American International Group, Inc. (AIG) announced it has completed its acquisition of Validus Holdings, Ltd., effective July 18, 2018. The deal was first announced on January 22, 2018.

Under the Validus umbrella, Western World Insurance Company and Tudor Insurance Company are US domiciled eligible surplus lines insurers in Texas. Additionally, Lloyd’s of London Syndicate 1183, a non-US entity, is an eligible surplus lines insurer. Stratford Insurance Company, which is licensed to write in the admitted market in Texas, is also included in the acquisition by AIG.

This marks the company’s largest acquisition since the 2008 financial crisis. AIG agreed to pay $68 per share in cash to purchase Validus, totaling $5.56 billion.

Founded almost 100 years ago, AIG provides insurance products and financial services in more than 80 countries and jurisdictions. Validus is a Bermuda-based company with diverse interests, such as reinsurance, surplus lines, and crop insurance. The deal will also allow AIG to re-enter the Lloyd’s of London marketplace, which it exited in 2016, through Validus’s Talbot (Lloyd’s syndicate 1183).

Western World Insurance Company, the surplus lines arm of Validus, wrote $48 million in Texas surplus lines premium in 2017, according to data recorded by SLTX. Tudor Insurance Company, also a subsidiary of Validus, reported $2 million in premium.

Three companies under AIG are eligible to write surplus lines insurance in Texas and are responsible for a combined $332 million in SLTX recorded premium for 2017. Lexington Insurance Company reported $253 million, while AIG Specialty Insurance Company wrote $65 million and Blackboard Specialty Insurance Company had $14 million.