Goldman Sachs Sells Reinsurance Unit Stake
Goldman Sachs Group Inc. has sold a majority stake in its reinsurance business — which includes Bermuda’s Ariel Re — to “institutions and high-net worth clients” as US financial firms adjust to demands by regulators for more capital, Bloomberg reports today [May 1].
Goldman Sachs is keeping a minority stake in the business, named Global Atlantic Financial Group, the New York-based bank said in a statement. The firm didn’t disclose the price of the private offering or what percentage it retained.
Chief Financial Officer Harvey M. Schwartz said in January that the international bank was considering selling a stake in the business because international regulators are imposing higher capital requirements. The bank at that time disclosed the unit’s contribution for the first time, saying revenue climbed 23 percent in 2012 to $1.08 billion.
The division has a global property and casualty reinsurance business as well as life and annuity reinsurance operations primarily in the US.
Goldman Sachs agreed in 2012 to buy Ariel Holdings Ltd’s. Bermuda-based insurance and reinsurance businesses to expand property and casualty coverage.
The bank said last month that reinsurance revenue was $233 million in the first quarter, up from $211 a year earlier.
