Sompo to acquire Aspen Insurance for $3.5 billion in cash deal

TOKYO/HAMILTON - Japanese insurer Sompo Holdings announced Wednesday it will acquire Bermuda-based Aspen Insurance Holdings for $37.50 per share in cash, representing a total consideration of approximately $3.5 billion. Sompo, with a market capitalization of $29.2 billion and annual revenue exceeding $36.7 billion, has maintained a "GREAT" financial health rating according to InvestingPro analysis, positioning it well for this strategic acquisition.

The transaction, unanimously approved by both companies’ boards of directors, offers a 35.6% premium to Aspen’s unaffected share price of $27.66 on August 19, according to a press release statement. The deal aligns with Sompo’s strong financial position, reflected in its impressive current ratio of 14.66 and robust return on equity of 11%.

Under the agreement, all outstanding Class A ordinary shares of Aspen will be redeemed for cash and delisted from the New York Stock Exchange, while Aspen’s preference shares will remain outstanding. Shareholders representing more than a majority of Aspen’s common shares have already approved the merger agreement.

Aspen brings a specialty insurance and reinsurance franchise with more than $4.6 billion in annual gross written premiums focused on specialty product lines. The acquisition will provide Sompo access to Aspen Capital Markets, which manages over $2 billion in assets from third-party investors.

"Strategic acquisitions have been a key part of our growth plan to build a robust and diversified global P&C platform, and Aspen represents an excellent opportunity at the right time in the market cycle," said James Shea, CEO of Sompo P&C.

Mark Cloutier, Aspen’s Group Executive Chairman and CEO, noted that "Sompo’s scale and capital strength will create significant opportunities for our customers, trading partners and colleagues."

For the twelve months ended December 31, 2024, Aspen reported a combined ratio of 87.9% and operating return on average equity of 19.4%. Sompo brings its own strong track record to the deal, with InvestingPro data showing consistent dividend payments for 18 consecutive years and a dividend growth of 32.36% in the last twelve months. Get access to more detailed financial metrics and 8 additional ProTips about Sompo’s performance by subscribing to InvestingPro.

The transaction is expected to close in the first half of 2026, subject to regulatory approvals and other customary closing conditions. Sompo expects the acquisition to be immediately accretive to its return on equity following completion, building upon its already impressive 10% return on invested capital.

Morgan Stanley is serving as financial advisor to Sompo, while Goldman Sachs is lead financial advisor to Aspen.

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