Blue Capital Reinsurance Holdings to target $125m in IPO

by Artemis on October 30, 2013

According to reports Bermuda based reinsurer Montpelier Re will target raising $125m for its new collateralized reinsurer Blue Capital Reinsurance Holdings through its initial public offering of shares to be listed on the New York Stock Exchange.

Reports suggest that Blue Capital Re will target offering 6.3 million shares at a price of $20 per share, aiming to raise $125m at the midpoint of a proposed pricing range. That would give the collateralized reinsurer a market capitalisation of $175m, which suggests that the seed capital that Montpelier Re is planning to provide in a concurrent private placement will amount to $50m.

Documents filed with the SEC actually show that Blue Capital Reinsurance Holdings can register 7,187,500 shares at a proposed maximum offering price of $20, amounting to a proposed maximum aggregate offering price of $143.75m. That suggests that the firm may be leaving a little room to go higher if the IPO is particularly successful.

The capital raise will give Montpelier Re and its third-party capital management arm Blue Capital Management another vehicle offering collateralized reinsurance capacity, primarily in the property catastrophe reinsurance market, just in time for the end of year reinsurance renewals.

Blue Capital is giving investors a range of ways to participate in the global reinsurance markets, with its listed fund, private accounts and now this listed reinsurer, which opens avenues to new classes of investor for the firm.

Deutsche Bank, Barclays, Keefe Bruyette Woods, Raymond James, UBS Investment Bank and RBC Capital Markets are reported to be acting as bookrunners for the IPO.

We’ll keep you updated as and when the results of the IPO are released.

More details on the forthcoming launch of Blue Capital Reinsurance Holdings can be found in this article.

Read our article from yesterday on Blue Capital’s contribution to Montpelier Re Q3 results.

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