The Westaim announced that Westaim HIIG Limited Partnership has raised US$70 million through the sale of additional Class A Units of the Partnership.
The proceeds from the Additional Offering were used to acquire additional shares of common stock of HIIG in order to fund (i) the purchase by HIIG, through HIIG Underwriters Agency, Inc., of all of the assets, including all fixed and intangible assets and the associated liabilities of the underwriting business trading as Elite Underwriting Services, a division of Elite Brokerage Services, an additional capital contribution to its subsidiary insurance companies and (iii) for general corporate purposes.
Elite is a Pennsylvania -based leading national managing general underwriter ("MGU") generating approximately US$100 million annually of medical stop-loss premium. Elite provides brokers, consultants, and carriers with a wide array of medical stop-loss market options and product flexibility necessary to meet the needs and expectations in today’s marketplace, writing business in all 50 states.
As a full-service MGU, Elite provides marketing, underwriting and binding, policy issuance, premium collection, licensure and appointment, commission payments and claims adjudication and payments services on behalf of its issuing carriers. After closing, it is expected that HIIG will retain approximately 50% of the written premium, with the remaining premium continuing to be written by another carrier.
Cameron MacDonald , President and Chief Executive Officer of Westaim, said, "Acquisitions have been an important element in HIIG’s growth over the years and we are excited to be able to continue to support HIIG as it executes its business plan".
Stephen L. Way , Chief Executive Officer of HIIG added, "The Elite Acquisition will add an important line of business to our expanding operations and we are pleased with the confidence that Westaim and the Partnership’s other limited partners have shown in our strategy".
In connection with the Acquisition, certain shareholders of EBS have agreed to use US$10 million of the cash proceeds received by them to subscribe for Class A Units in the Additional Offering.
In connection with the Additional Offering, Westaim subscribed for Additional Units for an aggregate subscription amount of approximately US$50.6 million.
Based on the initial allocations of Additional Units and HIIG Shares, Westaim currently owns approximately 58.9% of the issued and outstanding Class A Units of the Partnership and the Partnership currently owns approximately 75.7% of the issued and outstanding HIIG Shares.