Global investment firm Apollo Global Management has signed a conclusive agreement to acquire a majority shareholding in legacy specialist Catalina, it has been announced.
Affiliates of Apollo made an initial investment in Catalina in December 2013 and, as a result of the latest transaction, the Apollo acquisition vehicle, which is expected to include investment from certain long-term institutional and strategic investors, will have a controlling interest in the business.
The terms of the transaction were not disclosed.
The existing management team, which is headed up by founders Chris Fagan and Dean Dwonczyk, will continue to run the business and maintain a significant shareholding.
Since Apollo’s involvement in 2013, Catalina has grown substantially; doubling in size over the past three years, whilst maintaining its profitability. Catalina has completed 23 transactions acquiring $4.7bn of non-life insurance and reinsurance liabilities and had total assets of $3.6bn and shareholders’ equity of $700mn as of 30 June 2017.
Catalina CEO Chris Fagan said: “We’re delighted that Apollo, and the long-term institutional shareholders supporting it, are increasing their shareholding in Catalina. They are doing so at a time of significant change in the non-life insurance legacy sector which is developing faster now than at any point over the last 15 years. Catalina is one of the leading consolidators in the non-life run-off sector and together with our new shareholders; we believe the company is ideally positioned to continue our strong growth and development.”
Meanwhile, Gernot Lohr, senior partner at Apollo Global Management added: “We fully support the outstanding management team at Catalina and are excited about the opportunity to deepen our relationship with the business. Whilst already significant, the market for non-life legacy acquisitions continues to grow, and we believe Catalina is well positioned to capitalize on these opportunities due to its deep industry expertise as evidenced by its successful track record. We look forward to working with Catalina during the next phase of its growth and development.”
Catalina was advised by Barclays, JP Morgan and Allen & Overy. Apollo was advised by Sidley Austin
The transaction is expected to close in the first quarter of 2018, subject to regulatory approvals.