Signage for Tokio Marine &Nichido Fire Insurance Co. is displayed outside the company'sheadquarters building in Tokyo, Japan, on Friday, July 17, 2015.(Photo: Kiyoshi Ota/Bloomberg)

Continuing its goal to pursue business opportunities on foreignsoil, Tokio Marine announced that it has agreed to purchasePrivilege Underwriters, Inc. (PUI) for $3.1 billion from investorsled by Stone Point Capital and KKR. PUI, which does businessthrough the PURE Group of Insurance Companies (PURE Group),includes several business entities dedicated to serving the needsof high-net-worth clients, including PURE Risk Management, PUREInsurance Company, PURE Programs, and Haven Art Group. The deal isexpected to close in the first quarter of 2020.

The $3.1 billion price-tag is 33-times PURE Group's forecastprofit for 2020; however, Tokio Marine's Chief Executive SatoruKomiya said in a news conference, "We are paying for PURE's big potential growth." Following the acquisition, AM Bestplaced PURE Group's financial strength and credit rating underreview, with "positive implications" considering Tokio Marine'ssuccessful track record with past dealings.

Investing overseas

Earlier this year, Komiya explained the possibility of up-coming large-scale acquisitions in the U.S.and Europe, Bloomberg reported, which has come to fruition with thePURE deal. The transaction marks Tokio Marine's fourth sizableacquisition in the U.S. in 11 years, not counting its most recentU.S. acquisition of cyber insurance specialist NAS InsuranceServices in April 2019. Tokio Marine's last big U.S.acquisition — Houston-based HCC Insurance Holdings —closed at $7.5 billion in 2015.

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Heather A. Turner

Heather A. Turner is the managing editor of ALM's NU Property & Casualty Group. She can be reached at [email protected].

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