St. Paul Travelers Boosts Stake In Gulf Insurance

St. Paul Travelers Boosts Stake In Gulf Insurance

NU Online News Service, June 11, 2:29 p.m. EDT?A federal filing by The St. Paul Travelers Companies Inc. has disclosed that the company has bought out other investors in Gulf Insurance and that it plans to incorporate the unit into the corporation's specialty insurance operations.[@@]

Gulf Insurance is a New York-based unit that writes professional liability, directors' and officers', and errors and omissions, as well as other types of specialty insurance.

The Gulf unit was largely part of Travelers Property Casualty Corp. before the Hartford, Conn.-based Travelers merged with The St. Paul Companies in St. Paul, Minn. Travelers in 2002 sold a 24 percent stake in the Gulf's holding company to a group of investors including Trident II L.P. and Marsh & McLennan Capital Professionals Fund.

According to The St. Paul Travelers' federal filing this week, the merged insurer repurchased from Trident and other investors their equity-and-debt investments in the Gulf holding company for the amounts originally invested, as well as interest and dividends.

St. Paul Travelers representatives were not immediately available for comment on the deal, which was disclosed to the Securities Exchange Commission in advance of a stockholders meeting.

Separately, the federal filing showed that The St. Paul Travelers Chief Executive Jay Fishman is due to receive some $8.75 million in annual compensation and that the compensations for non-employee directors at the company would range from $140,000 to $165,000 a year, plus expenses.

Under a new five-year employment contract, the filings showed, Mr. Fishman will get an annual minimum base salary of $1 million, plus a target annual bonus of $1.5 million. Additionally, Mr. Fishman would get an annual long-term incentive valued at $6.25 million or more that could include stock options, restricted stock and other equity-based awards.

"The company offers its executives a compensation program that is market competitive, closely linked to company performance and designed to strongly align the interests of management with those of shareholders," The St. Paul Travelers noted in its federal filing.