Specialty property insurer Palomar Holdings, Inc. has completed its acquisition of The Gray Casualty & Surety Company (Gray Surety), a national surety carrier, and has also successfully closed new unsecured financing.
The transaction was first announced in October 2025, with Palomar agreeing to acquire Gray Surety from Bernhard Capital Partners (BCP) and The Gray Insurance Company for a total cash consideration of $300 million.
In connection with the acquisition, Palomar closed a new financing package consisting of a $150 million revolving credit facility and a $300 million term loan.
U.S. Bank National Association and KeyBank National Association served as Joint Lead Arrangers and Joint Book Runners. U.S. Bank National Association acted as Administrative Agent, with KeyBank National Association serving as Syndication Agent. Citizens Bank, N.A., The Huntington National Bank, PNC Bank, National Association, and Wells Fargo Bank, National Association acted as co-documentation agents, while JPMorgan Chase Bank participated in the term loan.
Commenting on the transaction, Mac Armstrong, Chairman and CEO of Palomar, said:
“I am pleased to announce the successful closing of our acquisition of Gray Surety, a national surety carrier with a proven and exceptional management team.
This transaction meaningfully strengthens Palomar surety franchise. It adds scale and geographic reach, complements our existing operations and puts us well on our way to building a market leader in the attractive surety sector. We are thrilled to officially welcome the Gray Surety team to Palomar and look forward to their contributions in advancing our Palomar 2x strategic framework.”
The acquisition expands Palomar’s presence in the surety market, adding scale, geographic reach, and underwriting capability as the group continues to execute its long-term growth strategy.
