Guardian Holdings Ltd’s sale of Jubilee Group Holdings Ltd approved

Guardian Holdings Limited

After almost 5 months, Guardian Holdings Limited’s (GHL) sale of Jubilee Group Holdings Limited (JGHL) has been approved.

Guardian Holdings Limited (GHL) agreed to sell their Lloyd’s of London business, Jubilee Group Holdings Limited (JGHL) earlier this year (May 2011) to Ryan Specialty Group, LLC for a total of £35 million, which amounts to TT$359 million, 2.33 times the book value (at the time).

The deal,  was subject to necessary regulatory approvals in the United Kingdom and Guardian Holdings Limited (GHL) is now advising that both the Governing Council of Lloyd’s and the United Kingdom’s Financial Services Authority have approved the sale of Jubilee Group Holdings Limited (JGHL) to Ryan Specialty Group, LLC.

The formal closing of the sale therefore took place on September 23, 2011 with the approval of these two regulators. The sale of JGHL’s shares will immediately net GHL approximately TT$140 million in cash and add to this year’s earnings per share. In addition to the proceeds from the sale of shares, GHL has approximately TT$308 million in capital committed to the underwriting of JGHL’s business.

GHL owned just under 40% of JGHL, and the decision to sell the business they say is based on ongoing strategic review of GHL’s businesses by the board since the start of 2009.

The release states;

The sale of JGHL fulfils a number of strategic objectives for GHL. One, having now fully returned to its Caribbean roots, the proceeds from the sale will be used to support the organic growth of its existing companies and will also be available for future acquisitions across the region.

Two, given GHL’s strong risk management culture and desire to deliver stable and growing earnings to its shareholders, the sale of JGHL reduces GHL’s exposure to world-wide catastrophic events. 2011 is already the highest ever loss year for catastrophic events in the history of the insurance business. This has continued a trend of a higher frequency of severe events. The sale of JGHL will dramatically
reduce GHL’s exposures to non-Caribbean catastrophe events and their concomitant negative effect to earnings.