Cohen & Co. targets $207m with second Butler-led re/insurance SPAC vehicle

Cohen & Company, LLC, the fixed income financial services focused investment specialist, has launched its second Special Purpose Acquisition Company, or SPAC, that targets insurance, reinsurance and insurtech investment opportunities.

INSU Acquisition Corp. II follows on from the first SPAC, often called blank check company, launched by Cohen & Co., which was named Insurance Acquisition Corporation.

Insurance Acquisition Corp. (IAC) eventually raised almost $151 million and then effected a combination transaction with automotive e-commerce firm, Shift Technologies Inc.

While that wasn’t immediately obvious as an insurance or reinsurance related transaction, the timing was particularly interesting given the outbreak of the Covid-19 pandemic and the shift to consumers buying from home, as well as the cross-sell potential of insurance products in future.

With INSU Acquisition Corp. II Cohen & Co. has ambitions to raise more funds for any eventual combination transactions it can source, with the structure targeting the sale of 20.125 million shares at $10.00 each, for a maximum offering of $201.25 million after over-allotments are accounted for and potential gross proceeds of almost $207 million after an additional private placement is considered.

Once again, John Butler, who was formerly a Managing Partner at insurance-linked securities (ILS) investment specialist Twelve Capital and joined Cohen & Co. in 2017 to drive the development of a U.S. Insurance Asset Management Platform and Global ILS Program, is lined up to lead the new re/insurance SPAC company.

Butler, who has broad expertise in reinsurance and in insurance-related investing, will be CEO and President of INSU Acquisition Corp. II, with a key role in originating and deciding on any acquisitions or combinations made by the SPAC with the capital it raises.

Cohen & Co. founder Daniel Cohen will take on the Chairman role for the SPAC.

As with the first Insurance Acquisition Corp., the target for this new Cohen & Co. SPAC is the insurance and reinsurance space, including insurtech combinations. But it could again elect to invest its money in a related or adjacent sector, if the opportunity is particularly attractive.

The shares eventually issued by INSU Acquisition Corp. II are expected to be listed on the Nasdaq Capital Market under the symbol “INAQU”.

These special purpose acquisition companies, or blank check investment vehicles, are an interesting prospect for investors right now, giving them a way to back investors with specific sector expertise on unknown acquisitions and combinations, but that can return significant multiples.

The listing makes the investment even more compelling for some investors, given the potential liquidity options it provides as well.

With its insurance, reinsurance, ILS and insurtech investing focus and the expertise of its managing team, Cohen & Co. is likely to be successful in raising all the funds it seeks for this second acquisition corporation, especially as major investor’s interests in these sectors are rising alongside the market returns right now.

Cohen & Co. also recently announced a successful fundraising of €375 million for European private insurance debt investments.