Assurant to Acquire The Warranty Group in Transaction Valued at $2.5 Billion

NYC-based provider of risk management solutions Assurant announced that it will combine operations with Chicago-based protection plans provider The Warranty Group, in a transaction valued at approximately $2.5B . Assurant shareholders will retain majority ownership of the combined company, whose name will be changed to Assurant Ltd.

“Assurant’s acquisition of The Warranty Group advances our position as a leading global provider in the vehicle protection business and aligns well with our lifestyle market growth strategy helping consumers protect their appliances, autos, mobile devices, and electronics. Together, we believe we can deepen our global footprint and accelerate profitable growth in key markets already on Assurant’s strategic roadmap, while realizing substantial operating synergies, generating more diversified and predictable earnings and furthering product innovation on a global scale” – Assurant President and Chief Executive Officer Alan Colberg.

The Warranty Group will enhance Assurant’s scale and market presence in its vehicle protection, extended service contracts and financial services businesses across 35 countries. The resulting geographic footprint also will provide resources to accelerate Assurant’s mobile strategy in key markets such as Asia-Pacific. The Warranty Group’s U.S. vehicle protection business also brings new client partnerships and distribution channels including dealer networks and national accounts, and positions Assurant to capitalize on emerging trends in the auto market such as digital auto retailers.

Fact. In Italy and Spain Amazon Protect is offered in collaboration with The Warranty Group.

Feeling.

The announcement follows the AmTrust-Arity tie up, which in my opinion is an entry point by one into Allstate’s SquareTrade business. Time will tell.