Bermuda-based global diversified insurance and reinsurance holding company Tower Group International (TWGP) has terminated its agreement to acquire American Safety Reinsurance (ASRe), from Fairfax Financial.

Without disclosing reasons for the cancellation, the company said that it expects to receive $5m in exchange for termination of such agreement.

The contract to acquire the Bermudian reinsurance subsidiary of American Safety Insurance Holdings was inked in June, at a total consideration of approximately $59m.

As per the original plan, the acquired reinsurance entity was supposed to be integrated with Tower’s Bermuda Reinsurer, Tower Reinsurance (Tower Re).

It was planned that after Fairfax Financial’s acquisition of ASI, the transaction pertaining to ASRe would complete during the second half of 2013.

Tower president and CEO Michael Lee commented earlier that the deal would allow the company to diversify and boost its specialty reinsurance business and clients and help expedite development of newly formed Bermuda reinsurance business platform.

Most recently, Tower Group entered into an agreement to acquire ANV Holdings’ marine and energy business, ocean marine, hull, cargo and liability, offshore energy, property and liability coverage focused on upstream energy and inland marine.

Set up during the first quarter of 2013 with the merger of Tower Group and Canopius Holdings Bermuda, Tower Re operates as a specialty reinsurance company and delivers an array of reinsurance products to Lloyd’s syndicates and to insurer in the US and Bermuda.