Ambac to acquire health insurance program manager ArmadaCare for $250m

NEW YORK - Ambac Financial Group, Inc. (NYSE:AMBC), currently trading at $9.72 with a market capitalization of $451 million, announced Monday it has entered into a definitive agreement to acquire ArmadaCare, a supplemental health insurance program manager, from SiriusPoint Ltd. (NYSE:SPNT) for $250 million. According to InvestingPro analysis, Ambac’s stock has shown strong momentum with a 10.3% return over the past six months, despite current market challenges.

The transaction, expected to close in the fourth quarter of 2025, follows Ambac’s recent sale of its legacy financial guarantee businesses and completes its transformation into a specialty insurance platform. InvestingPro data shows the company’s significant revenue growth of 148% in the last twelve months, though profitability remains a challenge with negative earnings per share of -$0.75.

ArmadaCare, headquartered in Hunt Valley, Maryland, specializes in supplemental health and workplace benefit products for employers. Under the agreement, ArmadaCare will maintain its current capacity provider relationships, including a new five-year commitment with SiriusPoint.

"The addition of ArmadaCare materially accelerates the growth and scale of our distribution platform, strengthens specialty product diversification, and expands relationships with distribution and capacity partners," said Ambac President and CEO Claude LeBlanc in the press release.

Ambac plans to finance the acquisition through a combination of cash on hand and newly issued debt, including a $120 million commitment from Truist Bank for a $100 million term loan and $20 million revolving credit facility. The company maintains a manageable debt profile with a debt-to-equity ratio of 0.17 and a current ratio of 1.02, according to InvestingPro metrics, which offers comprehensive analysis of over 1,400 stocks through its Pro Research Reports.

ArmadaCare’s current CEO Ed Walker will continue to lead the business alongside his management team following the acquisition.

The transaction is subject to customary closing conditions and regulatory approvals. Ambac expects the acquisition to be accretive to shareholders by 2026.

Truist Securities, UBS, and BMS Capital Solutions served as financial advisors to Ambac, while Jefferies LLC advised SiriusPoint on the transaction.

Ambac will host a conference call on September 30 to provide an update on its strategic priorities and discuss the acquisition. With the company’s next earnings report due on November 11, investors can access detailed financial analysis, Fair Value estimates, and additional ProTips through InvestingPro’s comprehensive research platform.

In other recent news, Ambac Financial Group reported its financial results for the second quarter of 2025, revealing a net loss. The company’s earnings per share (EPS) were -$0.22, which was below the analyst forecast of -$0.18, representing a 22.22% negative surprise. Revenue also fell short of expectations, coming in at $33 million compared to the anticipated $35 million, a 5.71% shortfall. Additionally, Ambac completed the sale of its legacy financial guarantee businesses to Oaktree Capital Management for $420 million in cash. This transaction involved the divestiture of Ambac Assurance Corporation and Ambac Assurance UK Limited, following approval from the Wisconsin Office of the Commissioner of Insurance. These developments reflect significant changes for Ambac, impacting both its financial performance and business structure. The recent earnings miss and the strategic sale of legacy units are notable events for investors to consider.

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