Enstar to Buy HSBC Closed-Life Insurance Businesses for $181 Million

   By Ben Fox Rubin 
 

Insurance consultancy Enstar Group Ltd. (ESGR) said it agreed to buy HSBC Holdings PLC's (HBC, HSBA.LN, 0005.HK) U.S. and Canadian closed-life insurance businesses for $181 million, as Enstar continues to expand in North America.

"Whilst our core focus remains non-life property and casualty run-off, we are excited to further expand our portfolio of run-offs with this acquisition of closed-life insurance business from HSBC," Enstar Chief Executive Dominic Silvester said.

Enstar acquires and manages insurance companies and provides management, consultancy and other services to the insurance industry. Last month, the Bermuda-based company agreed to buy insurance holding company SeaBright Holdings Inc. (SBX) for about $249.3 million in cash.

Enstar will be buying Household Life Insurance Co. of Delaware and HSBC Insurance Co. of Delaware from an HSBC affiliate. Both businesses have written U.S. and Canadian life insurance, including credit insurance, term life insurance, assumed reinsurance, corporate-owned life insurance and annuities.

The company plans to fund the deal through cash on hand and by drawing from its revolving credit facility.

Both the HSBC and SeaBright transactions are expected to close by the end of the first quarter of 2013.

Enstar's shares were up 0.02% at $93.85. HSBC American depositary shares were up 1.4% premarket at $43.66.

Write to Ben Fox Rubin at [e-mail]

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