AIG Nabs Validus for $5.6 Billion | Chief Investment Officer

Global insurer American International Group (AIG) will acquire all outstanding common shares of Bermuda-based Validus Holdings LLC for roughly $5.6 billion, the company announced Monday.

The move will add insurer Validus Re; insurance-linked securities asset manager AlphaCat ($3.2 billion); Talbot, a short-tail specialty line expert and Lloyds of London syndicate; and Western World, a US specialty property and casualty underwriter that focuses on small commercial E&S and admitted markets. AIG will also acquire Crop Risk Services, giving it access to the North American crop insurance market.

A cash consideration of $68 per share will be distributed among Validus common shareholders.

“Validus is an excellent strategic fit for AIG, bringing new businesses and capabilities to our General Insurance operation, expanding the bench of our management team, and deepening our underwriting expertise,” Brian Duperreault, president and chief executive of AIG, said in a statement. “With our global scale and the strength of our balance sheet, I am confident that Validus will thrive within AIG and strengthen our ability to deliver profitable growth for our shareholders as we strategically position AIG for the future.”

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As long as Validus shareholders approve and the acquisition meets other, customary closing conditions, which include regulatory approvals in relevant jurisdictions as well as completion of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, the deal is expected to close in mid-2018.

“We believe this transaction offers compelling value for our shareholders and reflects the strength of the business we’ve built together with our talented global team,” Ed Noonan, Validus’ chairman and chief executive, said in a statement. “Joining AIG and becoming part of a larger, more diversified organization immediately opens new opportunities for our people and our franchise. Validus will be able to serve clients and brokers in new and exciting ways, which will enhance our ability to grow profitably.”

Tags: American International Group, Aquisition, Validus

Venture funding tallied a record $182 billion last year, surpassing the peak of $148 billion set in 2015, a study by research group Preqin found.

Still, the number of VC-backed financings marked the second-consecutive annual decline. The number of deals totaled 11,144 in 2017, down from 11,699 in 2016. Meanwhile, the average size of most funding rounds has increased, said Felice Egidio, who heads venture capital products at Preqin.

One reason, he said in a statement, may be “the increasing competition for attractive opportunities,” as companies seek to raise large VC sums in late stages of their development, rather than turn to going public by selling stock or putting the business on the block.

Last year’s largest deal was the $5.5 billion funding of ride-sharing company Didi Chuxing, by investors including the Bank of Communications and China Merchants Bank. This was the second-largest VC deal of the past decade and the biggest Asia VC financing ever.

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North America had the largest portion of deal activity, with 4,302 investments for a $77 billion total. At the same time, Asia showed a sizable range of VC activity, with $65 billion invested in Greater China and $10 billion announced for India.

In 2017, the largest number of deals was for the beginning stage, known as the angel or seed round, with 32%, with the later Series A financings at 28%. Among industry sectors, software deals accounted for 26% of announcements by number, although internet firms had the largest dollar amount at 24%.

Exits had an uptick in 2017, with 1,151 VC exits amounting to $71 billion.

Tags: Didi Chuxing, Preqin, Venture Capital