Markel CATCo begins returning capital to listed fund shareholders

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Markel CATCo Investment Management has begun returning capital to shareholding investors in its listed retrocessional reinsurance investment fund, with almost $16 million set to be returns by way of an interim dividend.

Markel CATCo logoThe Board of the Markel CATCo exchange listed managed fund recommended an orderly run-off of the fund’s portfolios of retrocessional reinsurance risk investments, which shareholders voted in favour of.

Capital has now been redeemed from the Master Fund that the retrocessional reinsurance strategy allocates its funds to, meaning that the manager now has capital available to return to shareholders and is choosing to do so through this special dividend payment.

The manager now holds in aggregate $25.154 million of redemption proceeds and will return almost $16 million through the dividend payments, which break down as $0.0127 in respect of each Ordinary Share and $0.0262 in respect of each C Share for the year to 31 December 2019.

The rest of the redemption proceeds (less any working capital reserves), which is $7.972 million, will also be used to ensure investors get as much capital back as possible by carrying out share buybacks in the market following the ex-dividend date of October 17th.

As further side pockets held by the retrocessional reinsurance Master Fund are released, Markel CATCo expects to returns that and distribute the capital back to investors as the funds are available to do so.

So the process of returning capital to investors in the Markel CATCo managed retrocessional reinsurance funds continues, but will likely take some time to complete as winding down the operations and investment strategies fully requires all of its portfolio to be liquidated and loss payments due to be made, while any additional funds in side pockets may also be returned to investors once the quantum of all losses are fully understood.

Markel Corporation continues to work on its new retrocessional reinsurance insurance-linked securities (ILS) fund platform, in tandem with the winding up of Markel CATCo, having announced a key hire recently as the platform builds out.

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