I read this and conclude that Ted Kelly of Liberty Mutual really, really wants to buy Quinn Insurance, the p/c insurer taken over by Irish regulators in April.
I reason that Ted being a CEO and all is kind of busy and to give up an hour or so for an Irish Times interview must help achieve some corporate goal. But maybe I’m over-analyzing.
So in the course of a 1,400-word article he says:
- Liberty likes the Quinn business model and has done it successfully in Spain.
- Liberty has successfully handled turnarounds like Quinn’s in Venezuela and California.
- Because it has no presence in Quinn’s markets, Liberty would likely enact few staff cuts (other than the 900 already cut from the 2,400-person payroll), which would please regulators and the politicians who feed them.
- No interest in Quinn Healthcare as it doesn’t fit Liberty’s p/c profile.
And there’s this interesting line relating to some of Quinn’s insurance problems (underpricing and under-reserving):
Instead of trying to get rid of the bad, identify the good first and build on the good and then the bad falls into place.
Not exactly out of the ERM playbook, but there you have it.
In other Quinn news – pass the popcorn, please – Quinn Life’s Ukrainian connection is getting clearer.
Quinn Life – separate from the p/c business Ted Kelly wants – sank 6% of its assets into a property in Kiev to create an investment fund for the Quinn family and 100 or so of its closest friends.
It was the only property Quinn Life held on its books, and the company had to borrow from its parent, Anglo-Irish Bank, to get the property. But Ukrainian property values aren’t so hot these days and the bank loan looks dodgy. So Quinn has a hole in its books, and so does AIB.
Update: The scion of the empire, Sean Quinn, says he can pay back the €2 billion he owes AIB. Good luck, mate.