Onex CEO Sees Potential for More Insurance Deals After AIG Win

(Bloomberg) — Onex Corp.’s top executive says the alternative asset manager is affiliated with American International Group Inc. He said he was open to making bigger bets on insurance companies, following his move to team up with U.S.A. on a big deal.

Toronto-based Onex and AIG agreed last week to buy shares of specialty insurer Convex Group Ltd., a specialty property and casualty reinsurer, in a $7 billion transaction.

Once completed, Onex will own 63% of Convex on its balance sheet, while AIG will own 35%. The two companies are purchasing Convex from one of Onex’s private equity funds and co-investors.

Asked Friday if he sees more transactions like this, Chief Executive Bobby Le Blanc said yes. He said Onex had the ability to redeploy billions of dollars of capital from other assets on its balance sheet into “Convex-like” deals.

“I see it getting very condensed for you to understand; maybe there might be one or two more,” Le Blanc told analysts. “Insurance is of course a very natural topic for you to think about, but there are other things that we’ve done quite well over the years that we can be open to.”

In the Convex deal announcement, AIG also agreed to acquire a 9.9% stake in Onex for approximately $646 million and invest $2 billion in Onex funds over three years.

Onex sees the deal as a major transformation and is another step in the restructuring that Le Blanc has been working on for years. He cut spending and walked away from businesses like asset manager Gluskin Sheff while trying to expand credit.

Onex shares lost 1.3% to C$116.15 in afternoon trading in Toronto.

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