The Travelers Companies, Inc. has agreed to acquire cyber insurance managing general underwriter Corvus Insurance Holdings, Inc. for approximately $435 million.
Travelers has disclosed that it will fund the transaction from internal resources, adding that the transaction is expected to close in the first quarter of 2024, subject to regulatory approvals and other customary closing conditions.
Alan Schnitzer, Chairman and CEO of Travelers, commented, “We continue to make thoughtful investments in strategic capabilities that advance our innovation agenda.
“This transaction accelerates our access to cutting-edge cyber capabilities that were on our strategic roadmap, including sophisticated underwriting algorithms, advanced cyber vulnerability scanning and digital connectivity to customers and distribution partners.”
The firm noted that while the acquisition is strategically important, “the expected impact to earnings in the near term is immaterial.”
Jeff Klenk, Executive Vice President and President of Bond & Specialty Insurance at Travelers, went on, “Corvus’ expertise in excess and surplus lines for cyber, along with our industry-leading distribution position in the admitted markets, is a powerful combination.
“In addition to having the opportunity to renew Corvus’ $200+ million book of business, we will leverage Corvus’ leading capabilities to enhance the return profile of our already attractive cyber portfolio.
“We have a strong working relationship with the Corvus team through our existing cyber capacity arrangements in the United States and Europe, and we are thrilled to have them join the Travelers family.”
In September this year, Corvus announced it has expanded its relationship with Travelers, in which the primary insurer would serve as a capacity provider for Corvus products in the United States, starting October 1, 2023.
In 2022, the two companies announced a similar arrangement in the continental European market, where Travelers backed the Corvus Smart Cyber Insurance offering.
Madhu Tadikonda, Chief Executive Officer of Corvus, said, “At Corvus, we have been building a safer world through cyber insurance products and digital tools that reduce risk and improve resilience for policyholders.
“We are excited for the opportunity to contribute our capabilities and knowledge to Travelers. Our complementary cultures and strong commitment to innovation make this transaction an excellent fit.”
Jefferies LLC acted as financial advisor and Skadden, Arps, Slate, Meagher & Flom LLP provided legal counsel to Travelers, while Nomura Securities International, Inc. acted as financial advisor and Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP provided legal counsel to Corvus.
