XL Reinsurance America Inc. - a subsidiary of
XL Group plc
), completed the previously announced acquisition of the crop
insurance provider, Global Ag Insurance Services for an
undisclosed amount. Global Ag is based in the western United
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XL Group and Global Ag partnered in 2011 and offered crop
insurance products and services to western specialty crop
producers and growers through the USDA multi-peril crop insurance
program. Conventional crop insurance solutions and risk
management did not suffice the needs of producers in the region.
As a result, the two companies designed an alternative
specialized platform to meet the requirements of growers and
agents in the western United States. It is worth noting that
Global Ag has witnessed robust growth in the western region owing
to its well-established position among crop producers therein.
On the other hand, XL Group has been involved in the crop
insurance business for more than 10 years now. With this
acquisition, XL Group is looking forward to capitalize on the
expertise of Global Ag in the western U.S. Moreover, having
already worked together successfully through the partnership
tenure, XL Group is confident of accomplishing further on the
back of this acquisition.
XL Group's sturdy financial situation is expected to support the
transaction for the acquisition. The company exited the fourth
quarter of 2013 with solid cash balance of $1.8 billion.
Other property and casualty insurers are also adopting the same
path to ramp up its inorganic growth profile. In Dec 2013, a
wholly-owned subsidiary of
White Mountains Insurance Group Ltd.
) announced that it will take over Star & Shield Risk
Management LLC for an undisclosed amount.
In Nov 2013,
The Travelers Companies, Inc.
) closed its acquisition of Dominion of Canada General Insurance.
Also, in Jan 2014,
) and its local partners inked a deal to acquire a 60.9% stake in
The Siam Commercial Samaggi Insurance PCL - a general insurance
company in Thailand, from Siam Commercial Bank.
XL Group presently carries a Zacks Rank #3 (Hold).