(Bloomberg) ? Castlewood Holdings Ltd., which manages discontinued insurance businesses, and Shinsei Bank Ltd. agreed to buy a London-based unit of Tokyo?s Aioi Insurance Co. for ?62 million ($106.7 million. The unit, Aioi Insurance Co. of Europe, stopped selling most new policies in 2002, said Enstar Group Inc., one of Castlewood?s owners, in a statement last week. The company had assets of ?332 million at the end of 2004, the statement said. Enstar?s biggest shareholder is Christopher Flowers, a former Goldman Sachs Group Inc. partner and founder of New York- based buyout firm J.C. Flowers & Co. LLC. Bermuda-based Castlewood and Toyko-based Shinsei formed Hillcot Holdings Ltd. to make the acquisition.

Property and casualty insurers are liable for claims even if they?ve stopped selling new policies.

?You?ve got people who hold policies and need to be taken care of,? said Nimrod Frazer, chairman and chief executive officer of Enstar, in an interview. ?We buy these companies from people who are getting out of the business.?

Hillcot will pay ?50 million in cash when the transaction is completed and ?12 million a year later. Since 2002, the London-based unit has continued to underwrite policies with Toyota Financial Services and other Japanese companies, and that business will remain with the Aioi parent.