Dec 9 A group of investors led by
insurance-industry veteran Brian Duperreault struck a deal to
buy billionaire trader Steven A. Cohen's SAC Capital Advisors
LP's reinsurance business.
The deal for Bermuda-based SAC Re Ltd. is expected to close
in December, a spokesman representing Duperreault and the
investor group said on Monday, declining to specify terms. SAC
Re will be renamed Hamilton Re upon the deal's closing, with
Duperreault becoming chief executive officer.
The sale of SAC Re, which began operations in 2012 with $500
million in capital from Cohen, Capital Z Partners and other
investors, had been expected.
SAC pleaded guilty in November to insider trading, accepting
responsibility for criminal behavior by at least six of its
employees. That admission could cost the firm $1.8 billion in
civil and criminal penalties. A federal judge still needs to
approve SAC Capital's criminal guilty plea.
As part of the settlement, SAC agreed to give up managing
outside investors' money--terms that would preclude it from
investing premiums for a reinsurance company.
"We are proud of our role in founding SAC Re, but we are now
focusing on our transition to a family office and our core
investing business," an SAC spokesman said in a statement.
Duperreault brings significant insurance industry leadership
and underwriting experience to Hamilton as the former CEO of ACE
Limited and Marsh & McLennan Companies.
Duperreault left Marsh in December 2012 following a
five-year period during which he led the company's turnaround to
over $1 billion in annual profitability. Prior to joining Marsh,
Duperreault led ACE as president and CEO for almost 10 years
from 1994 to 2004, a period during which the company's
shareholders' equity grew from approximately $1 billion to more
than $9 billion.
In addition to Duperreault, those in the investor group
buying SAC Re include affiliates of the New York hedge-fund firm
Two Sigma Investments LLC, private-equity firms Capital Z
Partners and Performance Equity Management, and some
Two Sigma Investments, LLC will become the sole investment
manager for Hamilton Re's investable assets.
"We believe that there is a significant opportunity to bring
a fresh approach to insurance and reinsurance, one based not
just on world-class underwriting, but also a strong foundation
of large data analytics, research, and fully-integrated
technology. I am very excited to partner with Two Sigma in this
endeavor," Duperreault said in a statement.
"Two Sigma and I have been working together towards the
launch of a new company in the industry and this transaction
provides the ability to move forward on an accelerated timetable
with a strong team in Bermuda."