A team of lawyers from Clyde & Co’s Shanghai and London offices advised China Reinsurance Corporation (“China Re”), the country’s only state-owned reinsurance group and largest reinsurer, in connection with the formation of a strategic partnership with Catlin Group Limited (“Catlin”) that will result in the establishment of a special purpose syndicate at Lloyd’s of London.
The deal marks the first time that a Chinese company has invested money directly at Lloyd’s and will see China Re put an initial £50 million into the special purpose Syndicate 2088. The Syndicate will begin underwriting from 1 January 2012.
China Re’s participation in Syndicate 2088 will allow it to diversify its underwriting portfolio by reinsuring business underwritten by Lloyd’s to which it would otherwise have limited access to. The partnership will also help China Re gain better knowledge of how international insurance and reinsurance is underwritten in the Lloyd’s market and enable China Re to benefit from Lloyd’s worldwide network. As part of the terms in the partnership agreement, China Re employees will be seconded to Catlin to gain first hand experience working at Lloyd’s.
The Clyde & Co team was led by Corporate Insurance partners Carrie Yang in Shanghai and David Coupe in London with the assistance of associates Amanda Li (Shanghai) and Jennifer Yao (London).
Carrie Yang commented, “We are very pleased to have worked with China Re on this landmark strategic partnership with Catlin. The significance of this transaction is that it is the very first investment project by a Chinese insurance/reinsurance company in the overseas market. We believe that this will be the start of a growing trend that will see greater interest from insurers across the developing economies, especially from within China, in investing in Lloyd’s. Our knowledge of both the Lloyd’s market and the China market was a significant factor in us winning this prestigious mandate.”
Andrew Holderness, Clyde & Co’s Head of Global Corporate Insurance, said, “The ability to execute this type of novel transaction is typical of the capabilities we bring to bear in the global corporate insurance arena. As domestic growth stagnates, multinational insurers are increasingly looking at the global markets, such as the Asia-Pacific, for growth opportunities. They need advisers who can provide a one-stop shop solution to meet their legal needs across both the markets that they operate and are looking to operate in.”
Clyde & Co has one of the largest dedicated corporate insurance groups in the world, with 25 partners based in London, Shanghai, Hong Kong, Dubai and New York. This represents the strongest dedicated corporate insurance practice in London, Asia and the Middle East.
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