The reinsurer is being acquired from investors including Stone Point Capital, Kelso & Co. and Vestar Capital Partners Inc., the Toronto-based fund manager said today in a statement. The purchase is Canada Pension’s first direct investment in the insurance sector.
Wilton Re is “an ideal platform through which CPPIB can deploy significant follow-on capital at scale in the U.S. life insurance sector,” Andre Bourbonnais, senior vice president of private investments at the pension fund, said in the statement.
Reinsurance is attractive for pension funds as they seek long-term cash to match their liabilities. Reinsurers such as Bermuda-based Wilton Re have found opportunities in recent years by taking on business from primary carriers that are seeking to simplify operations or limit risks.
Wilton Re struck deals this year to assume liabilities from CNO Financial Group Inc. and CNA Financial Corp., the insurer controlled by Loews Corp. Wilton Re, run by ex-Swiss Re Ltd. executive Chris Stroup, won backing in 2004 from investors including insurance broker Marsh & McLennan Cos., and Vestar. Since its creation in 2005, Wilton Re has invested at least $1.7 billion in acquisitions and risk-transfer deals, according to the statement.