Munich Reinsurance Co. has completed its acquisition of specialty insurer HSB Group Inc. from American International Group Inc. for $739 million, the reinsurance giant said Wednesday.
Munich Re said in a statement that the cash deal formally closed Tuesday and was financed from internal resources.
AIG paid $1.2 billion for HSB in 2000, showing the difficulties the insurer faces in attempting to sell assets in today\'s market environment.
The core of Hartford, Conn.-based HSB Group is Hartford Steam Boiler Inspection & Insurance Co., an engineering risk specialist. The company had gross written premium income of $930 million last year.
Peter Roeder, a member of Munich Re\'s board of management responsible for North American business, said the acquisition of HSB Group is part of the reinsurer\'s plan to expand into U.S. specialty insurance segments.
"This is part of our strategy to grow profitably in the U.S., the world\'s most important insurance market," Mr. Roeder said.
"Our partnership with Munich Re will open new opportunities for HSB to create value for our clients and grow our business in the U.S. and around the globe," said Doug Elliot, president and CEO of HSB Group, in a statement. "With Munich Re\'s financial strength and added resources behind us, we look forward to continued profitable growth."
