Firms back major reinsurance spinout

French asset management and financial protection business AXA Group has accepted a Stone Point Capital-led bid for its reinsurance subsdiary AXA Re.

A consortium led by Greenwich, Connecticut-based private equity firm Stone Point Capital has had its offer to acquire the business of AXA Re accepted by the board of French asset management services provider AXA Group.
 
Other investors in the consortium are Hellman & Friedman, Vestar Capital Partners, Crestview Capital Partners, Och Ziff Management, ABN AMRO and New Mountain Capital.
 
Following completion of the transaction, AXA Group will maintain a 4 percent holding in the new business, Paris Re Holdings, which will have an initial capitalisation of approximately $1.5 billion (€1.17 billion).
 
Paris Re Holdings will be led by president and CEO Hans-Peter Gerhardt, who has held the position at AXA Re since 2003. Prior to joining AXA Re, Gerhardt served as executive vice president and member of the executive committee of global reinsurance business General Re Group.
 
Charles Davis, CEO of Stone Point Capital, said in a statement: “The AXA Re management team, led by Peter Gerhardt, has successfully repositioned this company over the past few years. Under Peter’s leadership, AXA Re generated an average ROE [return on equity] of 12 percent over the past three years despite unprecedented hurricane activity.”

Stone Point Capital was not immediately available for comment.
 
Formed in 2004 by the principals of MMC Capital, the private equity arm of Marsh & McLennan, Stone Point Capital currently manages more than $3 billion in committed capital through its Trident funds.
 
Stone Point Capital targets investments in the global insurance and financial services industries including investments in property and casualty, life, health, reinsurance, insurance distribution, insurance services, insurance and financial services-related technology, human resources and employee benefits industries.