R&Q signs agreement to acquire BHP captive

Randall & Quilter Investment Holdings has signed its second acquisition agreement of the week with a UK insurer, The World Marine & General Insurance Company (WMG), which is a captive for the resources company BHP Group.

The deal will see Randall & Quilter II Holdings, a subsidiary of R&Q, acquire the entire issued share capital of WMG, which was incorporated in England and Wales in 1894 and purchased by BHP in 1987.

WMG has written various insurance coverages since incorporation and from 1987 provided insurance protection solely for the BHP until it was placed into run-off in 2001.

Earlier in the week R&Q signed a seperate deal to acquire Inceptum Insurance. Both deals are subject to regulatory approval.

Paul Corver, group head of M&A at R&Q, said BHP is just one of several companies R&Q is negotiating potential exit or restructuring deals with for their captives.

“Current market conditions are causing companies to look closer at the capital tied up in their captives and whether it can be released to distribute to the parent or recycled to support new business lines,” he explained. “Disposal of legacy liabilities can achieve either of these ambitions.”