Last Updated: June 12, 2020
Proposed Acquisition of Control of Everspan Insurance Company by Ambac Financial Group, Inc.
On February 3, 2020, Ambac Financial Group, Inc. (AFG) filed a Form A, “Statement Regarding the Acquisition of Control or Merger with a Domestic Insurer," to acquire all the issued and outstanding stock of its indirect subsidiary Everspan Insurance Company (Everspan) from AFG's wholly-owned subsidiary Ambac Assurance Corporation (AAC). AFG made its Form A filing pursuant to s. 611.72, Wis. Stat., and s. Ins. 40.02, Wis. Adm. Code.
AFG is a holding company whose subsidiaries, AAC and Ambac Assurance UK Limited, provide financial guarantees for public finance and structured finance obligations to public and private clients globally. The last financial guaranty risk directly insured by Everspan expired in December 2018. With its financial guaranty business in run-off, Everspan revised its business plan currently to focus on the sale of surety bonds.
AFG currently owns all the issued and outstanding common stock of AAC, and AAC directly owns all the stock of Everspan. As such, Everspan is currently a subsidiary of AAC and indirectly owned by AFG.
AAC and Everspan are insurance companies domiciled in Wisconsin. However, the Form A discloses that AFG is considering redomesticating Everspan to Arizona.
The stated purpose of this transaction is to reposition Everspan as a subsidiary of AFG to “address issues with the implementation of Everspan's Business Plan and make it more likely that Everspan can write new direct business."
This transaction is properly described as an internal restructuring of AFG's holdings between affiliates and will not change the ultimate controlling person of either AAC or Everspan. As this filing concerns a transaction between affiliates, a hearing is not required under s. 611.72 (3m), Wis. Stat.
Further details of the transaction can be found in the documents filed with the OCI, below.
Form A and its Exhibits: