Onex to acquire 63% interest in Convex for $3.8-billion

Executive Summary

• Onex Corp. announced a transformational transaction to acquire the remaining interest in Convex Group Ltd. (a specialty property and casualty insurer) from Onex Partners V and co-investors, while simultaneously entering a strategic partnership with American International Group Inc. (AIG).
• AIG will acquire a 9.9% stake in Onex for approximately $600 million and commit $2 billion in new fee-generating assets under management to Onex’s private equity and credit strategies over three years.
• The combined transaction values Convex at a $7 billion equity valuation (1.9x Q3 2025 tangible book value), with Onex retaining a 63% stake and AIG acquiring a 35% stake, subject to regulatory approval in the first half of 2026.

Key Details

• Convex Acquisition Structure:
  • Onex will acquire a 63% equity stake in Convex for approximately $3.8 billion.
  • AIG will acquire a 35% stake in Convex.
  • The Convex management team (including founders Stephen Catlin and Paul Brand) will retain the remaining interest.
  • Convex valuation: $7 billion equity valuation, representing 1.9 times third quarter 2025 tangible book value.
• AIG Investment in Onex:
  • AIG subscribes for a 9.9% interest in Onex’s subordinate voting shares for proceeds of approximately $600 million.
  • AIG commits $2 billion of new fee-generating assets under management to Onex’s private equity and credit strategies over a three-year period.
  • AIG enters an investor rights agreement including a minimum three-year lock-up, customary standstill provisions, and the right to nominate one director to Onex’s board.
• Financing of Convex Acquisition:
  • Onex intends to roll over its existing $700 million interest in Convex.
  • The remaining $3.1 billion is financed via:
    • $1.5 billion in cash on Onex’s balance sheet and pending asset sales.
    • $1.0 billion of debt financing secured on existing private equity and credit assets.
    • $600 million of equity financing proceeds from the AIG subscription.
• Convex Operational Metrics:
  • Expected gross premium written in 2025: Up to $6 billion. 25% compound annual growth in gross premium written over the past three years.
  • 18% average return on equity over the past three years.
• Strategic Impact:
  • Convex is expected to account for 42% of Onex’s investing capital post-transaction.
  • A portion of Convex's investment portfolio is allocated to Onex-managed funds, expected to increase over time.
• Timeline and Advisors:
  • Transaction expected to close in the first half of 2026, subject to customary regulatory approvals.
  • Onex advised by Goldman Sachs & Co. LLC (lead financial adviser) and Latham & Watkins and Torys (legal advisers).

Notable Quotes

• Bobby Le Blanc, CEO of Onex: "Today's announcement is a logical and foundational step forward for Onex... With these transactions, we are bolstering our already significant position in the insurance sector, securing the support of one of the world's largest insurers, accelerating profitability of our asset management business and facilitating future growth in our investing capital."
• Peter Zaffino, Chairman and CEO of AIG: "With Onex Corp., Convex's primary shareholder, we are building a strategic relationship with an outstanding team... AIG will also benefit from preferred access to Onex's world-class investment funds..."
• Stephen Catlin, Executive Chair of Convex Group: "This transaction secures the long-term independence of Convex and presents a range of exciting strategic opportunities."
• Paul Brand, CEO of Convex Group: "This transaction positions us better than ever to service our clients and brokers, and take advantage of future market opportunities."