HONG KONG--(BUSINESS WIRE)--A.M. Best has commented that the Financial Strength Rating of A+ (Superior) and the Long-Term Issuer Credit Rating of “aa” of Mitsui Sumitomo Insurance Company, Limited (MSI) (Japan) remain unchanged following its announced acquisition of First Capital Insurance Limited (First Capital).
This Credit Rating (rating) commentary follows MS&AD Insurance Group Holdings, Inc.’s (MS&AD) announcement on Aug. 24 2017, that its wholly owned subsidiary, MSI, has entered an agreement to acquire a 97.7% stake in First Capital from Fairfax Financial Holdings Limited.
The acquisition price is USD 65.5 per share, totaling USD 1.6 billion, in an all-cash deal. The transaction is subject to the approval of relevant regulators and is expected to close between January and March of 2018.
MSI, the major operating entity of MS&AD in terms of revenue and earnings contribution, implements the group’s overseas expansion strategies. A.M. Best expects MSI’s risk-adjusted capitalization to remain supportive of the current ratings, following the transaction’s closing. The acquisition will allow MSI to expand its presence in the commercial insurance market in Singapore and the ASEAN region.
Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication.
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