Best’s News & Research Service - June 28, 2016 04:14 PM (EDT)
A.M. Best Comments on Ratings of National General Holdings Corp. Following Announcement of Acquisition of Elara Holdings, Inc.
OLDWICK //BestWire// - A.M. Best has commented that the financial strength ratings of A- (Excellent) and the issuer credit ratings (ICR) of “a-” of the members of National General Group (headquartered in Winston-Salem, NC) are unchanged following the announcement that their ultimate parent, National General Holdings Corp. (NGHC) [NASDAQ: NGHC] (headquartered in New York, NY), will acquire Elara Holdings, Inc., the parent of the members of the Direct General Group (Direct General). The ICR of “bbb-” of NGHC is also unchanged by this announcement. Each of these ratings has a stable outlook.
The acquisition will provide National General with enhanced direct marketing capabilities in the non-standard auto market in the Southeastern United States, strengthening its business profile. It will also provide additional cross-sale opportunities of National General’s personal lines products, including homeowners’ and accident & health policies. The ratings of National General are supported by the historical consolidated risk-adjusted capitalization and operating performance of the two organizations.
Following the completion of the acquisition, NGHC’s financial leverage and coverage are expected to remain in-line with A.M. Best’s expectations for its current rating level, based on a review of the transaction and expected future consolidated financial results.
A.M. Best will continue to monitor the progress of the transaction and evaluate any developments and implications for impact on the ratings.
This press release relates to rating(s) that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page.
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