American Financial Group Inc has reached a definitive agreement to sell GAI Holding Bermuda and its subsidiaries, which comprise the legal entities that own its Lloyd’s of London insurer, Neon, to RiverStone Holdings Limited.

When the transaction is done it will complete AFG’s exit from the Lloyd’s of London insurance market.

Neon is a member of Great American Insurance Group, which runs the insurance operations of parent AFG. It opened an office in Bermuda in 2016. Neon was put into run-off late last year, and in March announced its Bermuda office would be close this year.

Carl Lindner, AFG’s co-chief executive officer, stated: “The sale of Neon finalises AFG’s exit from the Lloyd’s market, following AFG’s decision to place this business into run-off effective in the fourth quarter of 2019. The exit allows us to provide continued focus on our other Specialty P&C businesses and enables us to redeploy capital, increase earnings and returns, and create long-term value for our shareholders.”

AFG expects the transaction to close in the fourth quarter.

RiverStone provides legacy insurance services. Luke Tanzer, RiverStone’s UK managing director, said the company will “ensure that Neon insureds continue to receive the highest possible level of service”.

TigerRisk Capital Markets and Advisory acted as exclusive financial adviser to AFG.