(Reuters) -Canadian asset manager Onex said on Thursday it has teamed up with U.S.-based insurer AIG to buy privately held specialty insurer Convex Group in a $7 billion deal.
Dealmaking has made a sharp
comeback as corporate boardrooms become inured to persistent uncertainty and pursue acquisitions in their quest for growth.
As part of the deal, Onex and AIG will take stakes of around 63% and 35%, respectively, in the firm, with the rest held by Convex's management.
The deal gives AIG access to a fast-growing specialty insurer with a complementary risk profile.
Earlier this week, AIG had also announced it would acquire the renewal rights for a majority of Everest Group's retail insurance portfolios worldwide.
The acquisition of Convex will strengthen Onex's presence in the insurance sector and boost the profitability of its asset management business, the company said.
AIG will also take a 9.9% stake in Onex and commit $2 billion to the asset manager's private equity and credit strategies over the next three years.
"These strategic investments are a great use of our capital with no operational, technical or integration risks," said AIG CEO Peter Zaffino.
Convex was founded in 2019 by Stephen Catlin and Paul Brand in partnership with Onex Partners V and its co-investors.
The company has since rapidly scaled into a major specialty property and casualty insurer with operations in Bermuda, London and Europe. It expects up to $6 billion of gross premiums in 2025.
The acquisition of Convex is expected to close in the first half of 2026. The investments in Onex and Convex are expect to boost AIG's earnings in the first year post closing.
Morgan Stanley acted as financial adviser to AIG, Evercore advised Convex and Goldman Sachs advised Onex.
(Reporting by Arasu Kannagi Basil in Bengaluru; Editing by Vijay Kishore and Krishna Chandra Eluri)
