28 September 2009
Tawa plc announces the acquisition of PRO
Tawa plc ("Tawa") will acquire the PRO group of companies ("PRO") comprising PRO Insurance Solutions Limited, PRO Insurance Solutions, Inc and Participant Run-Off (PRO), Iberica, SLU from the Swiss Reinsurance Group ("Swiss Re"), subject to FSA approval.
The acquisition is subject to a maximum consideration of £38 million, comprising initial cash consideration of £4 million and deferred cash consideration of up to £12 million dependent on PRO's earnings over the five years to 31 December 2014. Prior to acquisition, Swiss Re will receive dividends of approximately £22 million from PRO.
As part of the transaction, KX Re, a wholly owned subsidiary of Tawa, will purchase an estimated £7 million of insurance receivables at the time of closing.
Gilles Erulin, Tawa plc Chief Executive, commented: "We look forward to welcoming the PRO team to the Tawa Group where their invaluable knowledge of the run-off market and global platform will be of considerable benefit in achieving our strategic goals. We are also pleased that Swiss Re has confirmed that PRO will enjoy preferred provider status for servicing its run-off operations. The deferred consideration element has been agreed between Swiss Re and Tawa to ensure we work hand in hand to increase the profitability and value of PRO over the coming years."
Jonathan Isherwood, Member of Executive Board, Global Head of Claims and Liabilities, Swiss Re, commented: "PRO has been a small but successful part of Swiss Re since 1996. Today marks an important next step in PRO's development. We believe that the combination of skills and experience of PRO and Tawa Group will create the best opportunities for future growth of the business. On a personal note, we have enjoyed working with the Tawa team during this process and are confident that we can continue to partner going forward."