Allied World Financial Services Inc., a subsidiary of
Allied World Assurance Company Holdings, AG
) and Crescent Capital Group LP recently entered into an
Per the agreement, Allied World Financial Services will acquire a
minority stake in Crescent. At the same time it will allow
Crescent to access and engage $500 million of Allied World's
investment portfolio in different credit policies in the upcoming
Allied World expects the deal to be beneficial to its credit
strategies on account of the extensive experience that Crescent
has gathered particularly in below investment grade credit and
structured product investment. The investment strategies taken up
by Crescent and the strong returns that the Crescent clientele
have experienced over the years are expected to help Allied World
develop a stronger credit policy for itself.
Since its inception in the third quarter of 2012, Allied World
Financial Services have undertaken four strategic partnerships to
enhance its insurance and reinsurance businesses. All the deals
are expected to provide Allied World with the advantage of
controlled expenses, maximized returns on investment and improved
earnings. At this juncture the newest agreement with Crescent is
viewed as an added feather on its cap as it will enhance Allied
World's financial services portfolio through its extensive credit
We expect the Zacks Consensus Estimates to move north over
this optimism. Accordingly, the Zacks Consensus Estimate for 2013
is currently pegged at $7.02, representing a year-over-year
increase of nearly 37.8 %.
ALLIED WORLD AS (AWH): Free Stock Analysis
ENDURANCE SPLTY (ENH): Free Stock Analysis
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On the other hand as an asset management firm, Crescent remains
optimistic about the alliance as it is confident of improving its
existing service offered to investors in search of high-return
investment strategies. Crescent manages $11 billion in assets.
Allied World, a property, casualty and specialty insurance and
reinsurance provider, undertakes a number of partnerships and
acquisitions to strengthen its investment portfolio. In December
2012, the company announced the minority stake acquisition in
Bermuda-based Aeolus Capital Management Limited to expand its
financial services facility.
Endurance Specialty Holdings Ltd.
) which closely competes with Allied World, bought the assets of
Galileo Weather Risk Management and appointed its entire
workforce to launch a unit named Endurance Global Weather last
November. The new facility provides customized weather risk
management products which enable clients to cope with the adverse
effects of unpredictable weather changes on their businesses.
Allied world is scheduled to release its fourth quarter and full
year 2012 earnings results on February 13, 2013 after the closing
bell. The Zacks Consensus Estimate for the fourth quarter of 2012
is a loss $1.94 reflecting a 180.8% year over year decline. That
for full year 2012 is currently pegged at $5.09, representing a
year-over-year increase of 10 %.
Allied World currently carries a Zacks Rank #3 (Hold). Endurance
shares the same Zacks Rank.