Heerasing departs ACR as Catalina deal completes

April 1 2020 by Andrew Tjaardstra

Bermuda-headquartered run-off specialist Catalina Holdings has completed the acquisition of Asia Capital Re – which once represented around 8% of the total Singapore reinsurance market.

The move has been completed following regulatory approval from the Monetary Authority of Singapore and Bank Negara Malaysia, the change of control took place yesterday on March 31. ACR has offices in both Singapore and Kuala Lumpur.

The acquisition is Catalina’s first in Asia and is a strategic move to increase exposure to the significant run-off market across the continent. ACR ceased writing new business on December 5 and all existing policies in force will be serviced until expiry.

As part of the leadership transition at ACR following its acquisition by Catalina, chief executive Bobby A. Heerasing is stepping down as ACR’s chief executive and executive director on March 31. Heerasing (pictured) joined ACR in June 2017 as deputy chief executive (according to LinkedIn) before being promoted a month later; previously he was a long time director at Catlin (which subsequently became XL Catlin).

Both positions will be assumed by Martin Kauer, formerly the chief executive and chief financial officer of Glacier Re, Catalina’s Switzerland-based reinsurance run-off company. After the acquisition of ACR, Catalina has total assets of US$7.2 billion.

Asia’s estimated run-off reserves stand at US$101 billion (not including China and Australasia) – a 26% increase from 2018, according to PwC’s 2019 Global Insurance Run-off Survey.

This compares with US$348 billion in the US and US$292 billion in Europe. Respondents from the same survey marked Asia as the most likely emerging legacy market to develop over the next five years.

Chris Fagan, chairman and chief executive at Catalina Holdings, said: “This is a significant transaction for Catalina, as it gives us a strong platform from which to grow our Asian business and increase exposure to a significant and growing run off market.”

“I’m pleased with the integration of ACR to date, and look forward to executing similar Asia-based transactions in due course.”

Hsieh Fu Hua, chairman of ACR, added: “I’m very pleased with the speed and efficiency with which this transaction has been handled and would like to extend my appreciation to the former ACR management team, led by [Heerasing], for its significant contributions as well as professionalism during this ownership transition period. I look forward to working with my new colleagues at Catalina in Asia.”

To read more about the run-off potential in Asia see here.