Ace, Blackrock join to launch reinsurer
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Ace Ltd. and investment bank Blackrock Inc. have launched a joint reinsurance venture, ABR Reinsurance Ltd.
ABR Reinsurance Capital Holdings Ltd., ABR Re’s parent company, has raised about $800 million through a private placement, Ace said in a statement Wednesday.
Ace will be the only source of reinsurance risks ceded to ABR Re, and Blackrock will be ABR Re’s investment management service provider, according to the statement.
Ace said ABR Re will underwrite a portion of reinsurance treaties that Ace places with the traditional reinsurance market, and will invest its assets in an alternative investment portfolio managed by Blackrock.
Ace also said ABR Re’s investors will benefit from underwriting profit generated by ABR Re’s reinsuring a wide range of Ace’s primary insurance business and the income and capital appreciation Blackrock seeks to deliver through its investment management services.
William O’Donnell will head ABR Re as CEO, Ace said. He was previously senior vice president of distribution management and a global client executive with Ace Group Holdings Inc., according to the statement.
“ABR Re is a unique company that complements the traditional reinsurance market,” Mr. O’Donnell said in the statement. “The reinsurance market is undergoing cyclical and structural changes, driven by a substantial increase in alternative sources of capital and new risk technology including data analytics and portfolio management. Ace and Blackrock bring extraordinary vision, experience and a long-term commitment to this endeavor.”
ABR Re on March 19 filed documents with the Securities and Exchange Commission indicating it plans to raise as much as $1.3 billion.
Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Morgan Stanley & Co. L.L.C., and Morgan Stanley Smith Barney are listed as being involved in the placement.
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ABR Reinsurance to raise nearly $1.3 billion
ABR Reinsurance Capital Holdings Ltd., the reinsurance venture between Ace Ltd. and investment bank Blackrock Inc. has filed documents with the Securities and Exchange Commission indicating the venture plans to raise as much as $1.3 billion.
