Ryan Specialty Signs Definitive Agreement To Acquire Ethos Specialty Insurance’s P&C MGUs From Ascot Group Limited

Rhea-AI Summary

Ryan Specialty (NYSE: RYAN) has signed a definitive agreement to acquire the Property and Casualty (P&C) MGUs owned by Ethos Specialty Insurance from Ascot Group The acquisition will integrate Ethos P&C, founded in 2017, into Ryan Specialty's Underwriting Managers division. Ethos P&C comprises eight programs specializing in property and casualty coverages, including manufacturing, excess property, wind deductible buydowns, New York contractors, and CleanTech general liability.

The transaction, expected to close in September 2024, does not include Ethos' Transactional Liability MGU. Ethos P&C generated approximately $11 million in operating revenue for the 12 months ended June 30, 2024. This strategic move aims to enhance Ryan Specialty's portfolio and market presence in niche specialty lines.

Positive

• Acquisition expands Ryan Specialty's portfolio in niche specialty insurance lines
• Ethos P&C generated $11 million in operating revenue over 12 months
• Integration of eight specialized P&C programs into Ryan Specialty's offerings
• Potential for increased market share and diversification of underwriting capabilities

Negative

• None.

Insights

Financial Analyst

Ryan Specialty's acquisition of Ethos P&C MGUs is a strategic move that could enhance its market position in specialty insurance. The deal adds eight programs to Ryan Specialty's portfolio, diversifying its offerings in property and casualty insurance. With Ethos P&C generating $11 million in operating revenue for the year ending June 2024, this acquisition has the potential to boost Ryan Specialty's top line. However, the impact on profitability remains uncertain without disclosure of the acquisition price. Investors should monitor how well Ryan Specialty integrates these new programs and leverages them for growth in the competitive specialty insurance market.

Insurance Industry Expert

This acquisition strengthens Ryan Specialty's underwriting capabilities in niche areas like manufacturing, processing & warehousing and New York contractors. The addition of Ethos P&C's expertise in wind deductible buydowns and all other perils buydowns could be particularly valuable in a market facing increasing climate-related risks. The deal also expands Ryan Specialty's carrier relationships, which is important for an MGU business. However, the exclusion of Ethos' Transactional Liability MGU from the deal is noteworthy, as this segment has been seeing growing demand. Overall, this move aligns with the industry trend of consolidation among specialty insurers and MGUs to achieve scale and operational efficiencies.

CHICAGO & NEW YORK--(BUSINESS WIRE)-- Ryan Specialty (NYSE: RYAN), a leading international specialty insurance firm, is pleased to announce it has signed a definitive agreement to acquire the Property and Casualty (“P&C”) MGUs owned by Ethos Specialty Insurance, LLC (“Ethos P&C”) from Ascot Group Limited (“Ascot Group”). Ethos P&C was founded in 2017 by Ascot Group and will become a part of the Ryan Specialty Underwriting Managers (“RSUM”) division of Ryan Specialty. Ethos’ Transactional Liability MGU is not included in the transaction and will remain with Ascot.

Ethos P&C comprises eight programs which underwrite on behalf of a diversified panel of insurance carriers. In the property division, the firm specializes in manufacturing, processing & warehousing, excess property, wind deductible buydowns, and all other perils buydowns. Ethos P&C’s casualty coverages include New York contractors, construction wraps, real estate and CleanTech general liability.

Remarking on this acquisition, Patrick G. Ryan, Founder, Chairman & CEO of Ryan Specialty, said, “Ethos P&C has established itself as an underwriting manager offering innovation and excellent service in niche specialty lines. Their entrepreneurial spirit and complementary portfolio add depth and breadth to Ryan Specialty. We welcome this team of highly experienced underwriters and look forward to our future together.”

Jonathan Zaffino, Ascot Group CEO and President, commented, “Ethos Specialty is a thriving underwriting services business that, since inception, has achieved strong growth and profitability for its trading partners, while bringing innovative specialty insurance programs to the market. We are proud of the many accomplishments of our team and are confident that this strategic transaction will both advance Ascot’s long-term platform optimization goals and foster new opportunities for the Ethos P&C team under Ryan Specialty’s ownership.”

Ethos P&C generated approximately $11 million of operating revenue for the 12 months ended June 30, 2024.¹

Terms of the transaction were not disclosed. The acquisition is expected to close during September 2024.

Evercore served as exclusive financial advisor to Ascot.

About Ryan Specialty
Founded in 2010, Ryan Specialty is a service provider of specialty products and solutions for insurance brokers, agents, and carriers. Ryan Specialty provides distribution, underwriting, product development, administration, and risk management services by acting as a wholesale broker and a managing underwriter with delegated authority from insurance carriers. Our mission is to provide industry-leading innovative specialty insurance solutions for insurance brokers, agents, and carriers. Learn more at ryanspecialty.com.

About Ascot Group
Ascot Group is a global specialty insurance and reinsurance group with a record of underwriting excellence and superior claims service. Founded in 2001, Ascot provides a broad range of customized property and casualty products to customers worldwide through its Lloyd’s, Bermuda and US market platforms.

Ascot Group is owned by Canada Pension Plan Investment Board (CPP Investments), a global investment management organization that manages the assets of the Canada Pension Plan (CPP) in the best interest of the more than 22 million contributors and beneficiaries of the CPP. CPP Investments is the largest pension plan fund in Canada, totalling C$646 billion in net assets. CPP Investments is rated ‘AAA’ by S&P and Moody’s. For more information on Ascot, please visit www.ascotgroup.com.

1 Revenue attributable to the acquired business for the trailing twelve-month period ending June 30, 2024. This figure has not been audited.

 

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Ryan Specialty Contact:

Media

Alice Phillips Topping

Chief Marketing & Communications Officer

Ryan Specialty

Alice.Topping@ryanspecialty.com

+1 312-635-5976

Investor Relations

Nicholas Mezick

Director, Investor Relations

Ryan Specialty

IR@ryanspecialty.com

+1 312-784-6152

Ascot Group Contact:

Media

Kristina Corso

Prosek Partners

pro-ascot@prosek.com

+1 908-278-6225

Source: Ryan Specialty

FAQ

What is the purpose of Ryan Specialty's acquisition of Ethos P&C MGUs?

Ryan Specialty is acquiring Ethos P&C MGUs to expand its portfolio in niche specialty insurance lines, adding depth and breadth to its offerings in property and casualty coverages.

When is the Ryan Specialty (RYAN) acquisition of Ethos P&C expected to close?

The acquisition is expected to close during September 2024.

How much revenue did Ethos P&C generate prior to the acquisition by Ryan Specialty (RYAN)?

Ethos P&C generated approximately $11 million of operating revenue for the 12 months ended June 30, 2024.

What specific insurance programs will Ryan Specialty (RYAN) gain from the Ethos P&C acquisition?

Ryan Specialty will gain eight programs specializing in areas such as manufacturing, excess property, wind deductible buydowns, New York contractors, construction wraps, real estate, and CleanTech general liability.