Insurance firm Markel purchased all of the outstanding shares of Nephila, an insurance-linked securities manager, for an undisclosed sum.

Established in 1998, Nephila offers insurance-linked securities, catastrophe bonds, insurance swaps, as well as weather derivatives.

In addition, the business managed around $12.3bn in assets at the end of July 2018 and employs 180 staff.

Changes post-deal

Nephila will retain its operational independence post acquisition. Moreover, it will remain under the leadership of its existing co-CEOs Greg Hagood and Frank Majors. They will continue to operate from Bermuda, San Francisco, Nashville, and London.

Majors said: “We are delighted to be joining Markel, a company with a similar culture, strategic outlook and long-term focus. They have built a great company with a sterling reputation for both outstanding performance and a collaborative business approach, and have a proven track record of successful acquisitions.

“Markel shares our strategic vision for the future of the insurance markets; this transaction will allow us to accelerate our delivery of that strategy, creating additional value for our investors and our trading partners,”

Markel will fund the deal using its existing liquidity. Furthermore, the transaction is expected to complete in the fourth quarter of this year, subject to regulatory approval.

Markel co-CEO Richie Whitt said: “The combined assets under management (AUM) between Nephila and Markel CATCo will stand at approximately $19 billion, representing approximately 20% of the insurance-linked securities sector. With this transaction, Markel is set to become the largest manager of funds in this sector.”