Sovereign funds, Cerberus eye bond insurer stakes

Sovereign wealth funds and private equity firm Cerberus are looking at investing in bond insurers as the insurance companies try to raise money and hang onto their top ratings.

New York's state insurance superintendent said on Wednesday he has talked to sovereign wealth funds about potential investments in U.S. bond insurers. He declined to say if those conversations have ended or are continuing.

Separately, a person familiar with the matter said Cerberus Capital Management CBS.UL is in talks to invest in Ambac Financial Group Inc, the second-largest bond insurer.