Assured Guaranty to merge its AGM, AG into single insurance company (NYSE:AGO)

Assured Guaranty (NYSE:AGO) said Monday its Assured Guaranty Municipal Corp. (“AGM) business will merge into Assured Guaranty Inc., effectively creating a single insurance company.

The merger, the effective date of which is expected to Aug. 1, 2024, “will result in more efficient utilization of the combined capital of the two companies, and it will simplify the administration and eliminate duplicative expenses of Assured Guaranty’s U.S. financial guaranty operations,” said Assured Guaranty President and CEO Dominic Frederico.

In recent years, AGM has served as Assured Guaranty’s (AGO) flagship financial guaranty insurance company, offering guarantees on U.S. and non-U.S. public and infrastructure finance obligations.

AG, meantime, has provided risk and capital management solutions for insurance, pension and banking institutions, offered guarantees on structured financings, and served as the acquirer or reinsurer of insured portfolios of non-affiliated financial guaranty insurers in runoff.

In connection with the merger, the Maryland Insurance Administration approved a $300M stock redemption, also known as a special dividend, by the combined company. That’s expected to take effect shortly after the deal.