Through its subsidiary Sompo International Holdings, the group will purchase all outstanding Class A ordinary shares of Aspen for $37.50 per share in cash.
The valuation represents a 35.6% premium to Aspen’s closing price of $27.66 on Aug. 19 and a 24.6% premium on its 30-day average.
Aspen’s preference shares will not be affected and will continue under existing terms.
The boards of both firms have approved the merger, which is expected to close in the first half of 2026, subject to regulatory clearances and customary closing conditions.
Sompo has steadily expanded its property and casualty footprint beyond Japan in recent years.
Aspen, with annual gross written premiums of more than $4.6 billion, provides specialty insurance offerings including cyber, political risk, inland marine, construction, and management liability.
It also has a global reinsurance book across property, casualty, and specialty segments, alongside a Lloyd’s syndicate.
Mikio Okumura, Sompo Group chief executive, said the transaction supports the company’s strategy of strengthening resilience and increasing group-wide collaboration.
“I would like to express my sincere appreciation for the successful realization of this transaction, made possible through the full utilization of the diverse capabilities and market intelligence of the SIH executive team, Jim’s leadership, and the close collaboration with Sompo Holdings,” Okumura said.
James Shea, CEO of Sompo P&C, said Aspen provides “an opportunity at the right point in the market cycle” as Sompo continues to build scale in property and casualty insurance.
“We look forward to welcoming the team from Aspen as we bring our organizations together, recognizing that the property/casualty market continues to value platforms that can underwrite and manage capital and risk at scale – and with exceptional skill,” Shea said.
Aspen executive chairman and CEO Mark Cloutier said Sompo’s ownership offers capital strength and long-term stability.
“This transaction represents an excellent outcome for Aspen and our shareholders, while Sompo’s scale and capital strength will create significant opportunities for our customers, trading partners, and colleagues,” he said.
He added that the premium offered recognizes the business Aspen has built, including its Aspen Capital Markets platform, which manages more than $2 billion in assets from third-party investors.
That platform focuses largely on non-catastrophe, long-tail lines of business and provides fee-based income.
Aspen reported a 2024 combined ratio of 87.9% and an operating return on equity of 19.4%.
Sompo expects the acquisition to be accretive to its return on equity and to contribute toward its medium-term targets, which include a 13% to 15% adjusted consolidated ROE and more than 12% adjusted earnings per share growth by fiscal year 2026.
The group said cost and capital synergies are anticipated following integration of the businesses.
Morgan Stanley & Co. LLC acted as Sompo’s exclusive financial advisor, with legal support from Skadden, Arps, Slate, Meagher & Flom LLP.
Aspen received advice from Goldman Sachs & Co. LLC and Insurance Advisory Partners LLC, with Sidley Austin LLP serving as legal counsel.
