(Bloomberg) — Weston Hicks's Alleghany Corp. will pay $400 million to wind down reinsurance deals with American International Group Inc. and Warren Buffett's Berkshire Hathaway Inc. for policies that date back decades.
Transatlantic Reinsurance Co., owned by Hicks's firm, will end contracts that covered asbestos-related illness and environmental liabilities, according to an Alleghany regulatory filing Tuesday. Alleghany will post a $20 million charge in the fourth quarter tied to the accord.
AIG has been cutting ties with Transatlantic since spinning off the reinsurer in public offerings in 2009 and 2010. Hicks reached a deal in 2011 to buy the company, and a year later AIG agreed to pay Transatlantic at least $45 million to settle disputes tied to securities-lending losses that occurred when the companies were together.
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