Twelve Capital and Securis to merge, creating founder-led ILS manager with $7.8bn

Breaking news today as established insurance-linked securities (ILS) investment managers Twelve Capital and Securis Investment Partners have announced their intention to merge, with the resulting ILS manager set to be a significant founder-led business with around $7.8 billion in assets under management.

Both sets of shareholders are set to remain fully invested in the combined business and this transaction is expected to realise a significant opportunity to combine talent, assets and infrastructure, broadening and deepening capabilities across both catastrophe bonds and private ILS investments.

The two companies said today that their combination “ensures continued alignment of interests as the merger preserves independence and a client-centric approach.”

The new partnership is set to be led by Urs Ramseier, co-founder of Twelve Capital, who becomes Chief Executive Officer.

Herbie Lloyd, Chief Investment Officer of Securis, will become CIO Private ILS and Head of UK and Bermuda.

Christoph Buerer, co-founder of Twelve Capital, will become President of the merged entity, while Etienne Schwartz will become CIO of Liquid Securities.

Vegard Nilsen, Chief Executive Officer of Securis, is set to depart the business once the transaction is completed.

Urs Ramseier commented on the news, “We have always recognised Securis as an innovative and hugely respected business in the ILS market, and the combination of our two businesses presents an exciting opportunity to create a leading ILS franchise and one of the largest independent ILS asset managers globally.

“The coming together of our businesses will unlock significant innovation potential and enable a wider range of ILS solutions to be delivered to a truly global investor base, building on existing client coverage in North America, the UK and Europe, as well as Asia Pacific.”

Herbie Lloyd said, “Our combined resources, global scale and continued independence, together with our complementary distribution networks, mean that we can bring enhanced investment expertise and a broader range of product solutions to our current and future clients.”

A vote of confidence in this merger strategy is seen as shareholders are set to remain fully invested in the business and B-FLEXION, which is a long-term stakeholder in Securis, will continue to be a supportive, committed partner as the new company targets a vision to be a leading ILS industry player, as the asset class continues to experience a strong upward trajectory and its relevance continues to grow.

Cyrus Jilla, Group Managing Partner, B-FLEXION added, “As long-term backers of Securis’ business, we are excited to support this partnership. Our people and our combined client base will have access to additional complementary resources and expertise. Importantly, the new firm’s ongoing independence and ownership stability will ensure consistency and continuity in its client-centric investment approach. I also want to thank Vegard, whose contributions and stewardship of Securis have been pivotal in driving the business forward to this inflection point.”

Christoph Buerer commented, “As the industry experiences further consolidation, we believe we are favourably positioned for growth and long-term success through scale that is genuinely global. The combined business will be in a position to deliver superior outcomes to investors.”

Financial terms have not been disclosed and there is currently no mention of the name for the merged entity, after this transaction completes.

The deal is forecast to complete in the fourth quarter of 2024, subject to regulatory approvals.

While scale is important in insurance-linked securities (ILS) it’s unlikely the driver for such a merger of equals. More important is the fit and institutional quality of the businesses, as well as an aligned vision for taking the combined ILS manager entity forwards.

Securis was founded in 2005 and has a significant track-record across both public and private ILS, including collateralized reinsurance and retrocession strategies and also life ILS investments.

Twelve Capital was founded in 2010 and specialises in insurance and reinsurance investments across ILS and other instruments such as debt and equity. Twelve Capital also operates one of the largest catastrophe bond funds and has grown that specialism significantly in recent years.

The pair say their merging will ensure a “continued alignment of interests” and that the merged ILS manager entity will operate with preserved independence and adopt a “client-centric approach.”

“With complementary investment-driven cultures and expertise, the combined business will benefit from enhanced investment capabilities and market access, alongside a greater ability to invest in proprietary technology. The merged entity will also possess significant innovation potential and will be favourably positioned to serve investor demand for a diverse range of ILS strategies and products,” the companies further explained.

With a highly experienced global team spread across an office network that spans London, Zurich, Munich, Tokyo and Bermuda, as well as around US $7.8 billion in third-party assets at its command, the combined entity will jump straight into the top-tier of ILS managers and as a result changes the landscape somewhat, at an opportune time when the asset class is experiencing much greater stability and a return to growth.