Blue Capital Global Reinsurance Fund Limited, the newly launched reinsurance and retrocessional linked investment fund from reinsurer Montpelier Re, has successfully closed its first placement and offering of shares. The initial share offering has raised its target amount of $100.1m, through the successful issuance of 100.1 million Ordinary Shares at a price of $1.00 each, it is assumed that Montpelier Re has seeded the fund with the $50m it originally intended.
The proceeds of the share offering will be put to work investing in a diversified portfolio of fully collateralised reinsurance-linked contracts and other instruments carrying exposure to insured catastrophe event risks such as Industry Loss Warranties (ILWs), Catastrophe Bonds and other Insurance-Linked Securities. The Blue Capital Global reinsurance Fund will make its investments in preference shares issued by Blue Water Re Ltd., via a segregated account of the Blue Water Master Fund Ltd., a reinsurer which in turn writes the reinsurance contracts with the ceding companies.
John Weale, Chairman of BCGR, said; “We are delighted with the very positive response to the Issue from leading UK investors, which highlights the opportunity represented by our partnership with Montpelier’s global property catastrophe franchise. We believe Montpelier’s targeted approach will allow us to construct a diversified portfolio with attractive risk‐adjusted return characteristics. We expect the upcoming January 1st renewals to present us with a number of excellent opportunities to start deploying our capital.”
An application has been made to the London Stock Exchange’s Specialist Fund Market to have the shares admitted for trading and it is expected that they will begin trading at 8.00am on the 6th December.
The fund will be managed by Montpelier Re’s investment management subsidiary Blue Capital Management. The offering was facilitated by sole financial adviser Jefferies International Limited who also acted as bookrunner.
Blue Capital Global Reinsurance Fund is the latest investor backed reinsurance vehicle to launch bringing additional capital to the reinsurance market at a time of high investor interest in profiting from reinsurance premiums. It will be the third reinsurance-linked investment fund to list on the London Stock Exchange after the CATCo Reinsurance Opportunities Fund and DCG Iris.