OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has removed from under review with positive implications and upgraded the Financial Strength Rating (FSR) to A+ (Superior) from A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) to “aa-” from “a” of Endurance Specialty Insurance Ltd. (Endurance) (Bermuda) and its subsidiaries. A.M. Best also has upgraded the Long-Term ICR to “a-” from “bbb” and the Long-Term Issue Credit Ratings (Long-Term IR) of its immediate parent, Endurance Specialty Holdings Ltd. (Bermuda). The outlook assigned to these Credit Ratings (ratings) is stable. (See below for a detailed listing of the companies and ratings.)
These rating actions follow the completed acquisition of Endurance Specialty Holdings Ltd. by SOMPO Holdings, Inc. (Sompo), under which Sompo paid approximately $6.3 billion to acquire 100% of the outstanding ordinary shares of Endurance Specialty Holdings Ltd., which translates to $93 per share. The transaction obtained all necessary regulatory approval.
The rating actions reflect the operational benefits that Endurance will derive from being a significant operation within a larger organization with deep financial resources. As part of Sompo, Endurance will have more scale to help advance its books of business. Additionally, Sompo will provide explicit financial support to Endurance in the form of a net worth maintenance agreement. Furthermore, Endurance’s executive leadership will remain unchanged. Post-acquisition, Endurance will adopt the name and the identity of Sompo and a new holding company will be established titled Sompo International Holdings, Ltd., with all subsequent business being conducted under the Sompo name.
The FSR has been upgraded to A+ (Superior) from A (Excellent) and upgraded the Long-Term ICRs to “aa-” from “a” of Endurance Specialty Insurance Ltd. and its following affiliates with a stable outlook assigned:
- Endurance Assurance Corporation
- Endurance Worldwide Insurance Limited
- Endurance American Specialty Insurance Company
- Endurance American Insurance Company
- Endurance Risk Solutions Assurance Co.
- American Agri-Business Insurance Company
The following Long-Term IRs of Endurance Specialty Holdings Ltd. have been removed from under review, upgraded as follows and assigned a stable outlook:
-- to “a-” from “bbb” on $335 million 7% senior unsecured notes, due 2034
-- to “a-” from “bbb” on $300 million 4.7% senior unsecured notes, due 2022 (unconditionally assumed from Montpelier Re Holdings Ltd.)
-- to “bbb” from “bb+” on $230 million 7.5% Series B non-cumulative preferred shares
The following shelf ratings have been withdrawn for Endurance Specialty Holdings Ltd.:
-- “bbb” on senior unsecured debt
-- “bbb-” on subordinated debt
-- “bb+” on preferred stock
The following shelf ratings have been withdrawn for Endurance Holdings Capital Trust I & II (guaranteed by Endurance Specialty Holdings Ltd.):
-- “bb+” on preferred securities
This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings.
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