M&A

Alera and Propel also raised additional capital from private equity partners Genstar and Flexpoint.

The rebooting of efforts to find a buyer was considered, but CEO David Disiere has decided to retain the business.

“If we hit ’21, as I expect, based on most recent forecasts, and in ‘22 we get close to our plan, I think a possibility for this business would be a potential IPO in early ’23,” Cloutier told this publication on Tuesday.

The acquisition follows a buyout in May of Northwest Insurance Services, a subsidiary of Northwest Bank.

The combined business will have Ebitda of around $275mn, sources said.

The business is being marketed by investment bank Morgan Stanley following last year's sale of Ariel Re.

Vaaler offers business insurance, employee health and benefits and personal lines, specialising in the construction, education and healthcare industries.

The reinsurer was launched as a joint venture with Enstar, Allianz and Hillhouse in 2018.

Late-stage interest had come from New Mountain, Atlas Merchant and Centerbridge.

S&P noted that the deal volume was the highest on record for a decade, and came despite uncertainty over pandemic claims.

The drivers that led to the consolidation in the reinsurance industry might not replicate for a while.

The sale is another step in the company’s remediate or exit strategy in the business lines where it hasn’t met its scale or pricing targets.