HC2 has entered into a definitive agreement to sell its insurance segment to Continental General, an entity controlled by the company’s director Michael Gorzynski.
The transaction covers Continental Insurance Group and its fully-owned subsidiaries, Continental General Insurance Company and Continental.
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Continental General will finance the deal through combination of $65m in cash plus securities, including certain assets of the firm.
HC2 received a non-binding indication of interest from the buyer last December.
The company said it plans to use the proceeds from the deal for general corporate purposes.
HC2 chairman Avie Glazer said the sale of Continental will allow the company to focus on its three core operating segments – Infrastructure, Life Sciences and Spectrum.
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By GlobalDataHC2 president and CEO Wayne Barr, Jr called the deal ‘a further opportunity’ to enhance the company’s capital structure.
Commenting on the deal, Gorzynski said: “This transaction can help HC2 achieve key strategic objectives pertaining to portfolio optimization and balance sheet strength, while enabling Continental to accelerate the execution of its strategy.
“Continental is focused on developing an industry-leading servicing platform, diversifying into new lines of business and further capitalizing on market consolidation. I look forward to continuing to help build a Continental that is a valued true partner to all policyholders and stakeholders.”
The deal, subject to regulatory approvals, is expected to close in the third quarter of the year.
In 2015, HC2 agreed to buy American Financial Group’s long-term care and life insurance businesses.
