Arch Capital Subsidiary Acquires Old Republic's RMIC, Enhancing Mortgage Insurance Reach
Portfolio Pulse from Akanksha Bakshi
Arch Capital Group Ltd.'s subsidiary, Arch U.S. MI Holdings, is set to acquire RMIC Companies, Inc. from Old Republic International Corporation for approximately $140 million. RMIC, a run-off mortgage insurance business, will add $1 billion RIF to Arch MI's $75.9 billion RIF portfolio. The deal, expected to close in the first half of 2024, is subject to regulatory approval. Arch Capital's stock (ACGL) rose by 0.78%, while Old Republic's (ORI) increased by 0.11%.
November 13, 2023 | 2:57 pm
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POSITIVE IMPACT
Arch Capital's acquisition of RMIC is expected to enhance its mortgage insurance reach and create financial synergies. The stock saw a slight increase following the announcement.
The acquisition of RMIC is likely to be viewed positively as it enhances Arch Capital's mortgage insurance portfolio and is expected to result in expense and capital synergies. The slight uptick in stock price reflects initial market optimism.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
Old Republic's sale of its subsidiary RMIC to Arch Capital for $140 million could be seen as a positive move to streamline its operations. ORI's stock experienced a marginal increase.
The divestiture of the run-off mortgage insurance business could be seen as a positive step for Old Republic in focusing on its core operations, which may explain the slight positive reaction in its stock price.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 70