Bermuda-based insurer American Safety Insurance Holdings Ltd has agreed to acquire Cayman-based insurer Bluestone Surety Ltd.The company announced yesterday that its wholly-owned subsidiary, American Safety Holdings Corp, has signed a definitive stock purchase agreement to acquire Bluestone Agency, Inc and its Cayman insurance subsidiary, Bluestone Surety Ltd. Terms were not disclosed.Bluestone is a specialty provider of both commercial and contract surety, focusing primarily on transactional commercial surety. In 2011 Bluestone wrote approximately $16 million in premium.Bluestone will operate as a separate business unit under the direction of ASI’s surety division.Completion of the transaction is subject to regulatory approval and other standard conditions. The transaction is expected to close at the end of the second quarter. Terms of the transaction were not disclosed.“We look forward to David Pearlstein and the Bluestone team joining ASI. The two organisations are very compatible and the addition of Bluestone’s commercial surety expertise will further our strategic objective of growing our current product offerings and expanding our distribution network,” said Joseph Scollo, ASI’s president and chief operating officer.“The financial strength of ASI will open up additional markets for us in the surety space and give us access to enhanced capabilities to expand our existing channels,” said David Pearlstein, president and CEO of Bluestone. “The combination will allow us to better serve our agency plant and offer greater opportunities for our employees. Bluestone was built by providing a high level of customer service, making ASI’s solutions-oriented culture a fit with our existing corporate philosophy.”