Thursday, 24 July 2014
Last updated 7 min ago
Dec 10 2013 | 1:31pm ET
SAC Capital Advisors has agreed to sell its reinsurance business to a group of investors led by industry veteran Brian Duperreault and quantitative hedge fund Two Sigma Investments.
The group will pay between $500 million and $1 billion for Bermuda-based SAC Re, which will be renamed Hamilton Re when the deal closes. Duperreault, the former Marsh & McLennan CEO, will succeed Simon Burton as the reinsurer's CEO, while Two Sigma will effectively take over for SAC, investing the firm's premiums.
Two Sigma may also help assess and price risk for the reinsurer.
Capital Z Partners Management, the private-equity firm that helped set up SAC Re two years ago, will remain an investor. Performance Equity Management and several institutional investors are also part of the Duperreault-led group.
"This provides clarity for our clients and our regulators and we are confident Hamilton has a bright future ahead," SAC Re CFO Jonathan Reiss said.
SAC is selling the reinsurer following its guilty plea on insider-trading charges last month. As part of a deal with prosecutors, the firm has agreed to stop managing outside capital—such as that provided by SAC Re, which was set up as a permanent capital vehicle for the hedge fund.
"We are proud of our role in founding SAC Re, but we are now focusing on our transition to a family office and our core investing business," SAC said.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…