Sompo Holdings to buy Lexon unitsJanuary 5 2018 by InsuranceAsia News Staff
Sompo Holdings is set to acquire the operating subsidiaries of Lexon Surety Group, a key player in the US surety insurance market.
Lexon is the second-largest independent player in the in the US surety market based on direct written premiums of US$155 million in 2016.
The acquisition amount is estimated at ¥20-30 billion (US$177-266 million) and Sompo is using cash on hand to finance the deal.
Reports say Sompo Holdings will buy Lexon Insurance, Bond Safeguard Insurance and Fortress National Group.
It said it also intends to finalise the acquisition of the 100% stake in the subsidiaries from Lexon through Sompo International, its overseas holding company, by March.
Lexon Surety Group, which was founded in 2001, specializes in the surety insurance business.
Surety business is a specialty insurance line requiring a high level of specialist underwriting knowledge. This type of insurance pays penalties to contractees in case large construction and other projects cannot be executed.
In 2016, Lexon was said to be the second-biggest surety insurer in the US with premium income of about US$150 million.
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