Regulatory approval obtained for Arch-Allianz deal

Arch Insurance North America, part of Arch Capital Group, announced that regulatory approval has been obtained for its previously announced acquisition of the U.S. MidCorp and Entertainment insurance businesses of Allianz. Both parties expect to close the transaction on August 1, 2024, subject to customary closing conditions.

In April, Allianz Global Corporate & Specialty, Allianz Group’s carrier for large corporate and specialty insurance, announced an agreement to sell its US MidCorp and Entertainment insurance businesses, underwritten via its Fireman’s Fund subsidiaries, to Arch Insurance North America for an agreed cash payment of $450 million reflecting the franchise value of the business.

The transaction includes risk transfer for Allianz, as Arch is assuming approximately $2 billion of loss reserves associated with the business. The cash payment from Arch, together with an estimated $1 billion of Allianz capital supporting the business, is expected to result in $1.4 billion of total transaction value for Allianz Group.