The $800 million-plus sale of Hannover Re's U.S. subsidiary Praetorian Financial Group Inc., New York, to the Australian QBE Insurance Group Ltd., Sydney, was closed yesterday after regulators gave approval, the companies said.
QBE's U.S. subsidiary has acquired all shares of Praetorian. The purchase price is slightly in excess of $800 million, equivalent to 2.1 times Praetorian shareholders' equity excluding goodwill as of year-end 2006, Hannover Re said.
“Following the successful closing of this transaction we shall concentrate on our core business of reinsurance going forward,” Wilhelm Zeller, Hannover Re's chief executive officer, remarked in a statement.
He said the risk capital that has been freed will be invested in both non-life and life/health reinsurance business.
Hannover Re can tap into profitable growth opportunities in a number of areas, including raising its retention in the still lucrative property catastrophe segment, Mr. Zeller added.
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