(Alliance News) - Allianz SE on Friday sold its US MidCorp and Entertainment insurance businesses to Arch Insurance North America, part of Arch Capital Group Ltd, for USD450 million.

The division sold is part of Allianz Allianz Global Corporate & Specialty SE, Allianz Group's carrier for large corporate and specialty insurance.

Arch Capital is a Bermuda-based public limited company which writes insurance, reinsurance and mortgage insurance on a worldwide basis, with a focus on specialty lines.

The cash deal includes risk transfer for Allianz, the Munich-based insurer, as Arch is assuming around USD2 billion of loss reserves associated with the business.

The cash payment from Arch, together with an estimated USD1.0 billion of Allianz capital supporting the business, is expected to result in USD1.4 billion of total transaction value for Allianz, the firm said in a statement.

Going forward, AGCS US will focus on its large corporate and specialty business, Allianz said.

"This strategic step for our US business allows us to leverage our strengths in these important market segments, where we have deep expertise in addressing our clients' most complex risks," said Tracy Ryan, AGCS chief executive officer for North America.

Shares in Allianz closed down 0.4% at USD29.10 each in Frankfurt on Friday.

By Jeremy Cutler, Alliance News reporter

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