Massy United Insurance now owned by Bermuda company

Regional conglomerate Massy Holdings Limited has completed the sale of its insurance business Massy United Insurance Ltd. to the Bermuda-based Coralisle Group (CG) Ltd., in a deal estimated at US$90.5 million.

One senior executive of Massy United is promising there will be no changes to the structure or staff complement but said the competition in the insurance sector is about to heat up.

Announcement of the sale agreement was first made in September 2021, when CG’s Chief Executive Officer Naz Farrow described it as a “game changer” for the company.

The Massy Group said in a brief statement on Thursday that “the sale of this successful business is consistent with the Group’s strategy to focus its operations around its three main portfolios”.

“This transaction represents the Group’s exit of the property and casualty insurance business, and as we exit the insurance business we wish to thank all stakeholders for their continued support and assure our customers of continued coverage and service with the new owners,” said the statement from the Trinidad and Tobago-based conglomerate which operates Massy Stores.

Chief Executive Officer of Massy United Insurance Ltd. Randy Graham told Barbados TODAY the acquisition created new possibilities and meant increased competition for the insurance industry here.

“It is exciting times for the operations in Barbados. All of the staff and stakeholders are very excited about the possibilities because it represents a merger with another insurance company in the region, creating really a hulk of an insurance company. We have a highly experienced staff complement, [and] both Massy United and CG have very strong balance sheets with a lot of liquid assets available to pay claims for policyholders.

“What CG brings to the table is a lot of innovation in terms of products. So we really do create a well-managed big insurance company that will create a lot of innovative products for the clients. The staff are all staying on with the company, and all of the clients,” he said.

Graham said Barbadians should expect innovation and increased competition in the insurance space in the coming months.

“CG has a very innovative and strong medical insurance product and we are going to bring that in a very big way to Barbados and other territories in the Caribbean. The product has very high limits, excellent benefits for policyholders.

“Competition is always good. Competition will bring about benefits for the market, it will bring about benefits for the clients, and people will have more options. So, this merger will bring about more options to policyholders and persons seeking medical insurance in Barbados and the Caribbean. We can expect a competitive but innovative market response,” said Graham.

He said there were no plans for any changes in the structure of the operation, adding that “the only change is the ultimate shareholder will change from Massy to CG, but all structure, management and staff remain in place as is”.

Graham said while the company will continue to operate as Massy United Insurance, a name change was on the cards.

Massy Holdings Ltd voluntarily delisted from the Barbados Stock Exchange (BSE) at the end of 2016, and Graham said there were no plans for relisting at this stage, given that both companies were well capitalised.

CG’s acquisition of 100 per cent of Massy United Insurance, which was previously acquired as part of the Massy Group’s acquisition of Barbados Shipping and Trading in 2008, will allow the Bermuda-headquartered company to now have a presence in 14 new markets where Massy United operates – Anguilla, Antigua and Barbuda, St Kitts and Nevis, Montserrat, Dominica, St Lucia, St Vincent, Grenada, Trinidad and Tobago, Guyana, Curacao, Aruba, Jamaica and Belize.

CG and Massy United have complementary operations in the Bahamas, Turks & Caicos, British Virgin Islands, Barbados and the Cayman Islands, with minimal overlap in their product offerings.

In its financial highlights for the fiscal year ending September 30, 2021, Massy United Insurance noted that earnings were US$232 million in gross written premiums, representing a 17 per cent growth over the previous year.

The company recorded a US$10.7 million profit before tax. It settled just under US$30 million in net claims throughout the region during the year under review.

For the sale agreement, RBC Capital Markets acted as financial advisor to Coralisle Group Ltd. with Carey Olsen Bermuda Limited as legal counsel, while Ernst & Young Corporate Finance acted as financial advisor to Massy
Barbados Ltd.
marlonmadden@barbadostoday.bb