Insurer sells stake in underwriting agency

Insurer sells stake in underwriting agency

Insurer sells stake in underwriting agency Calliden Group Limited is selling its 50% holding in Arena Underwriting to Action Entertainment Insurance Pty Limited. It will make a profit of $500,000 from the sale.

Calliden established the joint venture with Action in November 2007 and since then this business has grown its book to $3m per year in premium.

Arena provides specialist underwriting for event, entertainment and security customers on behalf of Calliden Insurance Limited.
Following the sale, Calliden will continue as the insurer under a five year underwriting agency agreement with Arena.

 Over the past five years Calliden has established of several joint ventures. In that time the overall contribution of such ventures to the group result has totalled $14.4m, delivering a return on capital of 28% annualised, based on Calliden share of JV profits.
The return on capital increases to 53% annualised when the capital gain from divestment of CSA (December 2011), Sports Underwriting Australia (June 2010) and now Arena are included.

Nick Kirk Calliden’s managing director commented: “Our relationship with Arena continues through our agency agreement and we look forward to this continuing for many years to come. Creating new businesses and then selling our interest is a key part of our business model. We remain committed to developing new joint ventures with the next one planned for launch in the coming months. ”