German legacy insurance company DARAG has formed a joint venture (JV) with SOBC in Delaware, US to expand in the US and Bermuda/Caribbean run-off markets.
The JV, SOBC DARAG, combines the experience and capital access of DARAG with the local expertise of SOBC.
SOBC DARAG has acquired Florida-based nonstandard auto insurance company Peachtree Casualty Insurance.
The acquisition is subject to regulatory approval and is expected to be closed in the third quarter of this year.
DARAG CEO Tom Booth said: “Following our recent announcement of an additional equity commitment of €260m, DARAG is targeting the US and Bermuda/Caribbean markets through the SOBC DARAG JV. The agreement by SOBC DARAG to acquire a US carrier in run-off and the announcement of our joint venture with SOBC are exciting steps in our continued growth.
“We are pleased to be partnering with SOBC and see Peachtree as the first of many opportunities to work together in the US and Bermuda/Caribbean.”
SOBC CEO Stephanie Mocatta stated that SOBC already has a strong presence in the US and the Bermuda legacy markets.
“Working with DARAG can bring support in the form of strong capital backing and the joint venture will be able to provide a variety of run-off solutions to much a broader spectrum of companies that seek well priced and innovative solutions for their legacy portfolios,” Mocatta said.
Last month, the German insurance company secured €260m in equity funding from Aleph Capital and Crestview Partners.
The investment follows a period of significant strategic development for the company, which has seen substantial growth in the rapidly-expanding European insurance run-off market and will help in moving ahead with its plans to develop an effective platform for its US operations.
In the same month, DARAG had appointed Tom Booth as CEO.