Questions & Answers
Q |
What does Catalina do? |
| A | Catalina buys insurance and reinsurance companies and portfolios in run-off. |
Q |
Why does a seller trade with Catalina? |
| A | Sale of a company to Catalina with legacy liabilities provides the seller with a combination of finality from reserving deterioration and immediate capital release. This can have multiple benefits:
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Q |
Can Catalina really help with capital release? |
| A | The average price paid for our acquisitions is well in excess of $100 million and we are very happy to look at acquisitions with consideration up to $1 billion. |
Q |
Why not just keep it and run-it off ourselves? |
| A | You can but there is a positive arbitrage from a sale to Catalina which is reflected in the sale price. Catalina operates off a low expense base and is focused on accelerating liability run-off using commutations and other techniques which speed up the process of subsequent capital release. Catalina also structures each acquisition for maximum capital efficiency. |
Q |
Does Catalina only acquire companies or can liabilities also be transferred as portfolios or reinsurance transactions? |
| A | Catalina has balance sheets in Bermuda, Switzerland, the US and the UK and can arrange for the portfolio transfer of liabilities where that structure is more efficient, practical or suits a sellers needs. |
Q |
Does Catalina fund from its own financial resources or does it have to go and find the money? |
| A | Catalina acquires from its own funds at hand and can commit to transactions from its own funds but also uses bank facilities. |
Q |
How quickly can Catalina give an indicative price on an acquisition? |
| A | Very quickly. Subject to the provision of basic financial data, including recent actuarial reserving studies and detail of assets. |
Q |
Will Catalina take assets other than cash and government securities in support of liabilities? |
| A | Yes, Catalina has a sophisticated investment management team that can analyze and consider any liquid assets that are acceptable in the relevant regulatory environment. |
Q |
Is Catalina's business regulated? |
| A | Yes in multiple jurisdictions including by the BMA in Bermuda, FINMA in Switzerland, various State Departments in the US and by the FSA in the UK. |
Q |
Is regulatory consent required for a company sale? |
| A | Generally yes, and Catalina has a successful and established history of working through the regulatory consent process in all major insurance jurisdictions. |
Q |
Does Catalina manage liabilities for other companies? |
| A | Yes but only as a prelude to acquiring the business. |
Q |
Does Catalina buy captives? |
| A | Yes it is an areas where we have significant focus and are willing to advise vendors on options and solutions. |