CATCo listed retro fund to redeem more shares at much higher NAV

Reflecting the last few year’s recovery of value story in the Markel CATCo retrocessional reinsurance investment portfolio, the London listed fund entity is now set to buy-back the majority of its shares at a much higher net asset value than had previously been achieved in earlier share redemptions.

This morning, the CATCo Reinsurance Opportunities Fund Limited, which is the London-listed retro reinsurance investment fund operated by Markel CATCo, announced a further share redemption.

It intends to return roughly US $21 million of capital to investors on 27th November 2024, through a compulsory partial redemption of up to 109,323 Ordinary Shares and 74,889 C Shares in the fund.

It represents 95.73% of the fund’s remaining issued share capital, so takes it another step closer to completing its running-off.

This is the ninth redemption of shares by the CATCo retro fund and it will be at a price of $41.6197 per Ordinary Share and $221.6594 per C Share, which were the NAVs at 30th September 2024.

Those are much higher NAVs than previous buy-outs of shares, reflecting the recovery in value that has occurred as losses came in lower than anticipated on a number of contracts entered into as favourable development was reported over the last few years.

As we’ve been reporting, value has been repeatedly unlocked thanks to favourable development of losses that affected the CATCo retro reinsurance portfolio.

This has flowed to the benefit of investors and to parent Markel, which had previously bought-out many investors itself to provide them with liquidity.

Now, the story of CATCo is nearing its end and with so few shares now remaining it seems likely the name running-off of the retro reinsurance investment portfolio will soon come to a close.