Sompo to acquire Aspen in $3.5bn deal with unanimous board support
Japanese insurance giant Sompo has sealed a $3.5 billion agreement to acquire Bermuda-based specialty reinsurer Aspen, with both boards giving unanimous approval.
The deal is slated to close in H1 2026, pending regulatory and antitrust clearances. Shareholders holding a majority of common shares have already consented to the merger.
Sompo said the addition of Aspen will give it depth in specialty lines such as cyber, credit and political risk, UK property and US management liability. Aspen will also add global reinsurance capacity across casualty, property cat and specialty, while its Lloyd’s syndicate extends reach into the Americas, Europe and Asia Pacific.
The deal, widely flagged, comes as no surprise given that Japan’s non-life insurers have been ordered to sell off local equity holdings by the Japanese regulator, leaving them awash with cash.
“We expect large Japanese insurers to continue seeking growth opportunities overseas — even in non-insurance areas —supported by their strong capital,” AM Best said in April.
Sompo will buy 100% of Aspen’s Class A ordinary shares for $37.50 apiece in cash, a 35.6% premium to the unaffected share price of $27.66 on August 19 and 24.6% above the 30-day volume-weighted average price. At closing, all Class A shares will be redeemed for cash and delisted from the NYSE, while Aspen’s preference shares remain outstanding.
Aspen’s preference shares will remain outstanding with existing rights intact, though Sompo and Aspen may later redeem, repurchase or delist them.
Aspen’s capital markets arm manages more than $2 billion in sidecar vehicles. In 2024, it posted an 87.9% combined ratio and 19.4% operating ROE, with its streamlined portfolio expected to be immediately accretive.
Sompo expects cost and capital synergies as it integrates the business.
Mikio Okumura (pictured right), Sompo Group CEO, said: “In pursuit of realising Sompo’s purpose, we have been striving to enhance further resilience and to promote ‘Connect and Be Connected.’ To accelerate capital circulation management and collaboration across the Sompo Group, we established Sompo P&C and appointed James Shea as its CEO. This transaction is an excellent example of those initiatives in action.
“I would like to express my sincere appreciation for the successful realisation of this transaction, made possible through the full utilisation of the diverse capabilities and market intelligence of the SIH executive team, Jim’s leadership, and the close collaboration with Sompo Holdings.”
James Shea (pictured left), CEO of Sompo P&C, said: “Strategic acquisitions have been a key part of our growth plan to build a robust and diversified global P&C platform, and Aspen represents an excellent opportunity at the right time in the market cycle. We look forward to welcoming the team from Aspen as we bring our organisations together, recognising that the property/casualty market continues to value platforms that can underwrite and manage capital and risk at scale – and with exceptional skill.”
Mark Cloutier (pictured centre), Aspen group executive chairman and group CEO, added: “Sompo is a highly regarded brand and through this process it has become clear that they represent a long-term owner for Aspen that respects our business and shares our values and ethos. This transaction represents an excellent outcome for Aspen and our shareholders, while Sompo’s scale and capital strength will create significant opportunities for our customers, trading partners and colleagues.
“The significant 35.6% premium to our unaffected share price reflects the quality Sompo sees in our team, the depth of the group’s distribution relationships and the strength of the franchise that we have built across insurance, reinsurance and Aspen Capital Markets. We look forward to sharing more details as we work towards completion, while maintaining our focus on continuing to deliver great service and products for our customers.”
Morgan Stanley is Sompo’s exclusive financial advisor, with Skadden Arps as legal counsel and Kekst CNC handling strategic communications. Goldman Sachs leads Aspen’s financial advisory, joined by Insurance Advisory Partners, with Sidley Austin as legal counsel.
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