LONDON, UK: R&Q Insurance Holdings and Obra Capital Inc. have collectively acquired a wholly owned subsidiary of global security equipment producer MSA Safety Incorporated.
The acquired subsidiary holds legacy product legal responsibility claims relating to coal dust, asbestos, silica, and different exposures. MSA Safety contributed roughly $341 million in money to the Company, along with associated insurance coverage assets, and the three way partnership contributed $35 million.
As a results of the transaction, R&Q will present claims and administration services and Obra Capital (recently rebranded from Vida Capital) will present funding administration services to the Company.
The transaction has enabled MSA Safety to take away all legacy cumulative trauma product legal responsibility reserves, associated insurance coverage assets, and associated deferred tax assets of the divested subsidiary from its balance sheet.
As the transaction concerns non-insurance legacy liabilities, it will not be ceded to Gibson Re. The construction of the three way partnership and the associated exposures on this transaction result in reduced counterparty credit score risk for R&Q, and therefore means that the charges will be decrease than these earned from Gibson Re.
William Spiegel, R&Q’s Executive Chairman said: “We are happy to form a three way partnership with Obra to purchase and professionally handle these legacy liabilities, offering MSA Safety with a full finality solution.
This is an thrilling transaction for R&Q, showcasing the capabilities, reputation and innovation of our Legacy Insurance business.
This will see our reserves and non-insurance liabilities under administration increase to over $1 billion, comprising two pools: conventional insurance coverage reserves via Gibson Re, and non-insurance legacy liabilities. This furthers our technique of becoming a number one supervisor of legacy liabilities and displays our ability to execute transactions that match different legacy liabilities with the proper type of capital.”
Andrew Pinkes, R&Q’s Chief Executive Officer of Legacy Insurance said: “While we have been offering Legacy Insurance options to insurers, reinsurers and company captives for decades, this transaction opens up a brand new growth avenue in offering similar services for non-insurance, company liabilities.
This transaction is a strong demonstration of R&Q’s experience in underwriting and managing long-tailed liabilities, as well as to our innovative approach to structuring and delivering full finality solutions.”