Bermudian-based PartnerRe Ltd has agreed to buy Canadian life reinsurer Aurigen Capital Ltd in a $286 million deal.

In a statement released today, PartnerRe described Aurigen as a “top-five life reinsurer” in Canada, which generated gross premiums written of $110 million last year.

Emmanuel Clarke, PartnerRe’s chief executive officer, said the acquisition aligned “well with our overall strategy to grow our Life and Health business”.

Mr Clarke said: “Aurigen is a well-respected life reinsurance partner in the North American market and will be a highly complementary addition to PartnerRe’s existing business. This acquisition is expected to be financially accretive to PartnerRe’s book value per share in 2017.”

He added: “Aurigen will expand our life reinsurance footprint in Canada and the US with virtually no overlap in market coverage.

“We look forward to welcoming Aurigen to PartnerRe and to bringing all the benefits of PartnerRe’s strong balance sheet, excellent ratings and global franchise to existing and future clients in this market.”

Aurigen, a nine-year-old company, is licensed to transact life reinsurance in Canada, the US and Bermuda and has a life reinsurance in-force portfolio of more than C$100 billion and consolidated assets in excess of C$750 million.

PartnerRe said the C$350 million deal would be funded by cash on hand and was expected to close in the first quarter of next year, pending regulatory approvals.

The Bermudian firm, one of the group of reinsurers started in 1993 amid the market dislocation caused by Hurricane Andrew, is owned by Exor, the Italian-based investment arm of the Agnelli family, which completed its acquisition of the company in March this year.

Alan Ryder, Aurigen’s CEO, said: “We are very excited to be joining PartnerRe and look forward to helping grow its life reinsurance business. We believe there is a strong strategic fit between our two organisations and that the combination of Aurigen’s expertise in the life reinsurance market and PartnerRe’s strength and international presence will be of tremendous benefit to our clients.”

After the deal was announced, rating agency AM Best placed under review with positive implications Aurigen’s financial strength rating of A- (excellent).

“The under review with positive implications status reflects the potential financial and operational benefits that will be derived from Aurigen being a significant operation within a larger, higher-rated organisation,” AM Best stated. PartnerRe has a financial strength rating of A from AM Best.

Willis Capital Markets & Advisory is acting as the financial adviser to PartnerRe and Evercore is acting as the financial adviser to Aurigen.