Carlyle, Centerbridge, Gallatin Point, Bain Capital Credit back Sirius Int’l merger with SPAC

Several firms are backstopping plans by Sirius International Insurance Group to go public by merging with a SPAC.

Gallatin Point Capital, Carlyle Group, Centerbridge Partners and Bain Capital Credit are buying $213 million of Series B preferred shares from Sirius in a private placement. This may drop to $111 million at Sirius Group’s option, a statement said.

The investors will also receive warrants that are exercisable for five years after the issue date at a strike price equal to 125 percent of the merger price.

Sirius, Bermuda, offers reinsurance and insurance in more than 140 countries. It plans to use proceeds of the private placement to redeem all outstanding Series A preferred shares and for corporate purposes.

The deal comes more than a month since Sirius said June 25 that it was merging with Easterly Acquisition Corp. The New York blank-check company is led by former executives of Affiliated Managers Group and JC Flowers & Co.

The merger with Easterly will enable Sirius to trade on the Nasdaq. The transaction, expected to close in Q3 or Q4, will see Sirius have a $2.2 billion market cap.

Easterly is expected to own about 7 percent of the combined company. It’s unclear how much the firms will own.

Michael Papamichael, a Sirius Group spokesman, said the firms’ stake “will be contingent upon the final common equity raised in the PIPE.”

Sirius’s principal equity holder is CMIG International. CMIG, Singapore, acquired Sirius from White Mountains Insurance Group in 2016 for $2.2 billion.

ABRY Partners owns a stake in Sirius but is cashing out with the Easterly merger, Papamichael said.

Easterly raised $200 million when it went public in 2015. The SPAC is led by Avshalom Kalichstein, CEO and director. (Kalichstein is also a managing principal of Easterly LLC, the asset manager that owns stakes in boutique investment managers.)

Kalichstein is a former managing director of JC Flowers; he also led the corporate-development group at Shinsei Bank in Tokyo.

Darrell Crate is chairman of Easterly Acquisition. (He’s also the founder of Easterly, where he’s a managing principal.)

Crate spent 13 years as chief financial officer of AMG, which is known for buying up stakes in PE firms.

Kalichstein, Carlyle, Gallatin and Bain Capital Credit could not immediately be reached for comment.

Action Item: Contact Avshalom Kalichstein at avi@easterlycapital.com