Catalina Holdings (Bermuda) Ltd (Catalina) announces that it has closed a USD700 million equity capital raise and concluded its shareholder restructuring following receipt of regulatory approvals.
Following completion of this transaction, affiliates of Apollo Global Management, together with its consolidated subsidiaries, have become majority shareholders of Catalina, with RenaissanceRe Holdings Limited becoming a minority shareholder alongside Catalina’s management. As part of the shareholder restructuring, the Apollo Funds have committed an additional USD700 million in new equity capital to fund Catalina’s continued growth. Together with existing committed and undrawn equity, this brings Catalina’s total committed and undrawn equity to USD850 million.
The conclusion of the shareholder restructuring follows the announcement in October 2017 that the Apollo Funds had signed a definitive agreement to acquire a majority shareholding in Catalina. Apollo’s acquisition vehicle includes a number of blue-chip, long term institutional and strategic investors.
Chris Fagan, Chairman and Chief Executive of Catalina, says: “We are pleased to announce that the transaction has closed, and delighted to have secured additional equity commitments of USD700 million, which together with our existing committed and undrawn equity, prior commitments from RenaissanceRe, and our own strong cashflow generation, gives us equity firepower of over USD1 billion. When that is combined with our relationship with Apollo’s other entities, it gives Catalina very substantial financial resources to originate much larger transactions than have been done in the non-life legacy sector to date.”
“We believe the completion of this sizeable equity financing, and the Apollo Funds becoming majority shareholders, are a significant milestone for Catalina. This transaction consolidates the Company’s position as a leader in the non-life run-off industry,” says Gernot Lohr, Senior Partner at Apollo. “We look forward to building upon our strong relationship with Chris and the outstanding team at Catalina, and leveraging Apollo’s deep insurance expertise and our other reinsurance entities to continue to help drive the Company’s significant growth.”
Catalina’s relationship with Apollo dates back to December 2013 when funds managed by affiliates of Apollo made an initial investment in the Company. Since then, Catalina has grown significantly, having completed 16 transactions acquiring USD3.8 billion of non-life insurance and reinsurance liabilities, and as at 31 August 2018 had total assets of USD4 billion.
Sidley Austin LLP represented Apollo Global Management, in this acquisition.
