[8-K] White Mountains Insurance Group Ltd. Reports Material Event

Rhea-AI Filing Summary

White Mountains Insurance Group, Ltd. (WTM) has entered into a Unit Purchase Agreement to acquire a 51% controlling interest in specialty insurance program manager Distinguished Programs for approximately $230 million in cash. The transaction, executed on 4 July 2025 and announced on 7 July 2025, will be effected through wholly owned subsidiary WM Monroe Holdings, Inc. and is expected to close in Q3 2025, subject to regulatory approvals and customary conditions. There is no financing or shareholder-approval condition, and closing must occur by 2 Oct 2025 or either party may terminate.

• WTM already owns ≈1% of Distinguished; post-closing stake will rise to 51%.
• Sellers receive standard indemnities; Buyer obtained a representations & warranties insurance policy and WTM guarantees Buyer’s obligations.
• Put/Call: On the third anniversary of closing, sellers may require WTM to buy, or WTM may elect to buy, an additional 29% of units. Seller put price equals the original unit price (≈$130 million if fully exercised); WTM call price equals 1.35× the original unit price.
• Termination rights apply if closing is not achieved by 2 Oct 2025.

The deal expands WTM’s fee-based specialty insurance platform while utilising balance-sheet cash. Financial accretion, earnings impact, and Distinguished’s standalone metrics were not disclosed in the filing.

Positive

• Acquisition of a 51% controlling stake increases WTM’s exposure to fee-based program management, enhancing business diversification.
• $230 million all-cash deal financed without external borrowing, indicating strong liquidity.
• Put/Call structure offers flexible future ownership and caps downside pricing risk for additional 29% stake.
• No shareholder approval or financing contingency reduces closing risk and speeds execution timeline.

Negative

• Undisclosed financial metrics for Distinguished hinder assessment of valuation and earnings accretion.
• Potential $130 million seller put represents additional future cash outflow.
• Completion contingent on regulatory approvals; deal terminates if not closed by 2 Oct 2025, introducing timing risk.

Insights

M&A Specialist

TL;DR: Cash purchase secures controlling stake, favourable optionality, modest size vs. WTM capital base—overall strategically positive.

At ≈$230 million, the outlay equals roughly 4% of WTM’s end-2024 shareholders’ equity, leaving ample firepower for other initiatives. The absence of a financing contingency signals internal liquidity and accelerates closing certainty. The put/call design is attractive: WTM gains strategic control now and retains upside via a capped seller put while securing a discounted call (1.35×) if performance exceeds expectations. Reps-and-warranties insurance further mitigates integration risk. Because Distinguished operates in program management—an asset-light, fee-generating niche—the transaction should diversify WTM’s earnings mix away from underwriting volatility. Lack of disclosed EBITDA multiples limits valuation analysis, yet structure and limited size suggest low balance-sheet risk with meaningful optional upside.

Risk Analyst

TL;DR: Transaction presents execution and regulatory risks; unclear earnings impact keeps overall risk balanced.

Key uncertainties include regulatory approval, integration of governance with minority holders, and potential additional cash outlay of ≈$130 million if the seller put is exercised. Distinguished’s financials are undisclosed, preventing assessment of acquisition multiples or accretion. While WTM’s guarantee and R&W insurance reduce specific liabilities, they also expose the parent to indemnity claims. Termination right after 2 Oct 2025 limits long-tail uncertainty, yet any delay could defer expected Q3 closing benefits. Net impact appears neutral until more financial detail emerges.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

July 4, 2025

Date of Report (Date of earliest event reported)

WHITE MOUNTAINS INSURANCE GROUP, LTD.

(Exact name of registrant as specified in its charter)

Bermuda (State or other jurisdiction of  incorporation or organization) 1-8993 (Commission file number) 94-2708455 (I.R.S. Employer Identification No.)

23 South Main Street, Suite 3B, Hanover, New Hampshire 03755

(Address of principal executive offices)

(603) 640-2200

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Shares, par value $1.00 per share

WTM

New York Stock Exchange

WTM.BH

Bermuda Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).                                     Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.      o

ITEM 1.01 Entry into a Material Definitive Agreement.

On July 4, 2025, White Mountains Insurance Group, Ltd. (“White Mountains”) and its indirect wholly owned subsidiaries WM Monroe Holdings, Inc. (“Buyer”) and WM Phoenix GP, LLC entered into a Unit Purchase Agreement (the “Purchase Agreement”) with AQ Phoenix Parent, L.P. (“Distinguished Programs” or “Distinguished”) and certain other parties thereto. The Purchase Agreement provides that Buyer will acquire, inclusive of White Mountains’s existing approximately 1% interest, a 51% controlling interest in Distinguished Programs (the “Transactions”) for approximately $230 million in cash.

On July 7, 2025, White Mountains issued a press release announcing the entry into the Purchase Agreement. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is hereby incorporated by reference into this Current Report.

The Purchase Agreement contains customary representations and warranties as well as covenants by each of the parties, including certain operating restrictions on the conduct of the business of Distinguished during the period from the execution of the Purchase Agreement to the closing of the Transactions. The selling unitholders of Distinguished will indemnify Buyer, and Buyer will indemnify the unitholders of Distinguished for damages arising from breaches of their respective representations and warranties under the Purchase Agreement, subject to certain limitations set forth in the Purchase Agreement. In addition, Buyer has obtained a customary representations and warranties insurance policy covering breaches of the representations and warranties made by Distinguished and certain sellers.

White Mountains has agreed to guarantee Buyer’s obligations under the Purchase Agreement.

The Purchase Agreement also contains provisions giving each of Buyer and Distinguished the right to terminate the Purchase Agreement under certain circumstances, including where the closing of the Transactions has not occurred on or before October 2, 2025.

The Transactions are expected to close in the third quarter of 2025. Completion of the Transactions is subject to receipt of certain regulatory approvals and other customary closing conditions. There is no condition with respect to the availability of financing to consummate the Transactions. Completion of the Transactions does not require the approval of the White Mountains shareholders.

On the third anniversary of the closing of the Transactions, certain sellers will have the right to sell additional units (representing 29% of the total units at closing) to White Mountains at the same unit price paid in the Transactions, the total price for which, if exercised in full, is expected to be approximately $130 million. White Mountains will have a parallel right to purchase such units at 1.35x the unit price paid in the Transactions.

The foregoing description of the Purchase Agreement and the other transaction documents related thereto does not purport to be complete and is subject to and qualified in its entirety by reference to the text of such agreements. We intend to file the Purchase Agreement as an exhibit to our next periodic report.

ITEM 9.01. Financial Statements and Exhibits.

(d) Exhibits

99.1 Press Release, dated as of July 7, 2025

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Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

This Current Report on Form 8-K may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included or referenced in this filing which address activities, events or developments which White Mountains expects or anticipates will or may occur in the future are forward-looking statements. The words “could,” “will,” “believe,” “intend,” “expect,” “anticipate,” “project,” “estimate,” “predict” and similar expressions are also intended to identify forward-looking statements. These forward-looking statements include, among others, statements with respect to White Mountains’s:

•change in book value per share or return on equity;

•business strategy;

•financial and operating targets or plans;

•incurred loss and loss adjustment expenses and the adequacy of its loss and loss adjustment expense reserves and related reinsurance;

•projections of revenues, income (or loss), earnings (or loss) per share, EBITDA, adjusted EBITDA, dividends, market share or other financial forecasts of White Mountains or its businesses;

•expansion and growth of its business and operations; and

•future consummation of any transaction and the timing thereof, including any recapitalization, distribution, repurchase or financing.

These statements are based on certain assumptions and analyses made by White Mountains in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors believed to be appropriate in the circumstances. However, whether actual results and developments will conform to its expectations and predictions is subject to risks and uncertainties that could cause actual results to differ materially from expectations, including:

•the risks that are described from time to time in White Mountains’s filings with the Securities and Exchange Commission, including but not limited to White Mountains’s 2024 Annual Report on Form 10-K;

•claims arising from catastrophic events, such as hurricanes, windstorms, earthquakes, floods, wildfires, tornadoes, tsunamis, severe weather, public health crises, terrorist attacks, war and war-like actions, explosions, infrastructure failures or cyber-attacks;

•recorded loss reserves subsequently proving to have been inadequate;

•the market value of White Mountains’s investment in MediaAlpha;

•business opportunities (or lack thereof) that may be presented to it and pursued;

•actions taken by rating agencies, such as financial strength or credit ratings downgrades or placing ratings on negative watch;

•the continued availability of capital and financing;

•the continued availability of fronting and reinsurance capacity;

•deterioration of general economic, market or business conditions, including due to outbreaks of contagious disease and corresponding mitigation efforts;

•competitive forces, including the conduct of other insurers;

•changes in domestic or foreign laws or regulations, or their interpretation, applicable to White Mountains, its competitors or its customers; and

•other factors, most of which are beyond White Mountains’s control.

Consequently, all of the forward-looking statements made in this Current Report on Form 8-K are qualified by these cautionary statements, and there can be no assurance that the actual results or developments anticipated by White Mountains will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, White Mountains or its business or operations. White Mountains assumes no obligation to publicly update any such forward-looking statements, whether as a result of new information, future events or otherwise.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

WHITE MOUNTAINS INSURANCE GROUP, LTD.

Date: July 7, 2025

By:

/s/   MICHAELA J. HILDRETH            Michaela J. Hildreth       Managing Director and       Chief Accounting Officer

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FAQ

What did White Mountains Insurance Group (WTM) announce in its July 2025 8-K?

WTM agreed to buy a 51% controlling interest in Distinguished Programs for $230 million in cash.

When is the Distinguished Programs acquisition expected to close?

The parties expect closing in Q3 2025, subject to regulatory approvals and customary conditions.

Is the acquisition subject to shareholder approval or financing conditions?

No. The filing states no shareholder vote or financing contingency is required.

What optional future purchase rights are included in the deal?

On the third anniversary, sellers may put, and WTM may call, an additional 29% stake at predefined prices.

What happens if the deal does not close by 2 October 2025?

Either party may terminate the Purchase Agreement if closing has not occurred by that date.

How is transaction risk mitigated for WTM?

WTM obtained a representations & warranties insurance policy and will receive customary indemnities from sellers.