Property and casualty insurer ACE Ltd. said Thursday that it reached a deal to buy Ally Financial Inc.'s Mexican insurance business for about $865 million in cash.
ABA Seguros is one of Mexico's largest property and casualty insurers and provides auto, homeowners and small business coverage. The company has more than 30 sales offices throughout Mexico and distributes its products through nearly 2,000 independent agents, along with auto dealerships, banks and direct channels.
Switzerland-based ACE said it expects the acquisition, which is expected to close in the first half of 2013, to boost its profit in the first year.
The deal follows ACE's September announcement that it would buy Fianzas Monterrey, one of Mexico's largest surety lines companies, for about $285 million in cash. ACE said the additions of the companies will allow it to take advantage of growth opportunities in Mexico in the years to come.
Switzerland-based ACE said the acquisition will help diversify its business in Mexico. It currently has commercial property and casualty, accident and health, and life insurance operations in that country.