XL Group and Stone Point Capital LLC announced the finalization of their new Bermuda-based investment management company for insurance-linked securities and other reinsurance capital market products on Thursday. XL will acquire a 75% controlling stake in the company while private equity firm Stone Point will own the remaining 25%.
XL Group plc, a worldwide insurance and reinsurance company, provides provides casualty, property and specialty products to various enterprises including commercial and industrial firms and insurance companies through its subsidiaries. Stone Point is a Conneticut-based private equity firm that specialises in providing financial services and has raised five private equity funds with a combined capital of greater than US$9 billion.
When operations of the new unit begins, the company will focus on XL-designed reinsurance products, ILS and index-linked products. The two companies have agreed to invest up to a total of US$135 million in funds to be formed, alongside possible third party investors.
"Stone Point is delighted to be partnering with XL on this venture. Stone Point's relationship with XL dates back to 1986 when our team assisted with the formation of the company. We believe that the convergence of the traditional insurance and reinsurance markets, and the capital markets will continue. This initiative with XL is designed to offer third-party investors an opportunity to invest in this asset class in partnership with one of the world's premiere reinsurance underwriters," said Stone Point CEO Charles A. Davis.
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