American Capital Acquisition Corp. has reached a deal to acquire the U.S. property-casualty division of GMAC Financial Services with the help of an investor.

In a filing with the SEC Oct. 19, GMAC announced the agreement with Bethesda, Md.-based American Capital, following a “comprehensive strategic review of GMAC’s broader insurance business,” which includes its automobile, commercial vehicle, motorcycle and recreational vehicle insurance offerings.

AmTrust Financial Services, headquartered in New York, announced it has entered into an agreement for an investment of $42.5 million in American Capital in connection with the GMAC acquisition.

GMAC noted in the SEC filing that the dealer-related insurance business, which includes extended service contracts and insurance for auto dealer inventories, is not affected by the transaction and “remains a strategic component of GMAC’s insurance platform.”

Terms of the agreement were not disclosed and are subject to regulatory approval and customary closing conditions.

Christopher M. McNamee, a spokesman for GMAC Financial Services, told IFAwebnews.com the transaction “is part of GMAC’s efforts to refocus on strategic operations and restore financial performance.”

“The transaction pairs the U.S. consumer property and casualty insurance business with an owner that has robust operational and technological capabilities and is committed to building a U.S. personal insurance footprint,” McNamee said. “We expect the majority of the U.S. consumer property and casualty insurance team to transition to [American Capital].”

GMAC Insurance, established in 1925, is a wholly owned subsidiary of GMAC Financial Services. According to AMTrust, GMAC’s property-casualty unit has a network of 10,500 agents in 12 core U.S. markets and exclusive relationships with 23 affinity partners. Its property-casualty business had a net written premium in excess of $1 billion in 2008, encompassing all 50 states.

AmTrust is a multinational insurance holding company that offers specialty property-casualty insurance products through its insurance carriers, including workers’ compensation, commercial automobile and general liability and extended service and warranty coverage.

“This investment is not only a very attractive preferred equity investment for AmTrust, but it provides strong strategic advantages as well,” Barry Zyskind, president and CEO of AmTrust, said in a statement. “Primarily it provides us immediate access to a new distribution force of 10,500 agents that will be equipped to cross-sell our AmTrust products.”

The proposed deal comes after GMAC has experienced losses in seven of the last eight quarters, according to Bloomberg, and after the U.S. Treasury pumped $13.5 billion in assistance to the company through its Troubled Asset Relief Program last year.

American Capital did not return requests for comment from IFAwebnews.com.