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HAMILTON, BermudaMaiden Holdings Ltd. has bought the reinsurance operations of GMACI Holdings L.L.C., Maiden announced Monday.
Mount Laurel, N.J.-based GMAC Re L.L.C. will be acquired by Maiden Holdings' U.S. subsidiary, Maiden Holdings North America Ltd. The transaction will form a dedicated U.S. reinsurance group, Maiden Re, that will be based in Mount Laurel, N.J., the Bermuda-based reinsurer said. Maiden Re is expected to generate $1 billion in annual written premium, the company said.
Terms of the acquisition were not disclosed.
As part of the deal, two U.S.-domiciled GMACI unitsGMAC Direct Insurance Co. and Integon Specialty Insurance Co.will be transferred to Maiden Holdings, following regulatory approval. During the transition, GMAC Insurance Co. will continue to write reinsurance, which Maiden will reinsure on a 100% basis. After the deal is complete, Maiden will write all business directly, the company said.
Maiden Insurance will assume GMAC Re's outstanding loss reserves, totaling $750 million as of Sept. 30, and unearned premium of roughly $200 million.
"We believe that with the acquisition of GMAC Re, Maiden will fast-forward its business plan, and the combination of GMAC Re with existing Maiden business will uniquely position the company in the marketplace," Barry Zyskind, chairman of Maiden Holdings Ltd., said in a statement.
GMAC Re's 120 employees will join Maiden Re, the company said.