New York based asset manager Rosh Capital Management, LP has raised $600 million from a private family office to launch Rosh Re Ltd., a Bermuda based reinsurance company that will have an investment oriented approach.
Rosh Capital Management had established a total-return or hedge fund focused reinsurance initiative back in 2018.
It’s not clear at this time whether Rosh Re Ltd. is an iteration on that initial venture into reinsurance for Rosh Capital Management, or a completely new approach. Or whether any of the team we mentioned in that 2018 article are still involved.
It seems likely the new launch builds on that earlier initiative and seeks to capitalise on the hardening of reinsurance, as timing is everything.
Rosh Re Ltd. will provide traditional reinsurance, as well as what the company terms “bespoke rehabilitative solutions,” which are likely legacy related solutions to help companies offload and reach finality in books of business.
Subject to regulatory approvals, Rosh re is launching with a $600 million lead investment from WM Holding AG, which is a family office of industrial investor Ajay Kumar.
“I am excited to invest in Rosh Capital Management LP’s differentiated reinsurer and to partner with Michael and his team,” explained Kumar. “I have been seeking to capitalize on the exceptional opportunity this hardening market brings and found Michael’s unique strategy compelling and unlike any I have seen in the reinsurance space. His strategy benefits from the hardening market while managing insurance and investment risk to generate optimal value throughout the cycle. We are cautious in how we deploy our capital and felt strongly that Rosh’s strategy strikes the right balance.”
Michael Jacobs, CEO of Rosh Capital Management LP also said, “I’m delighted to have the support and backing of Ajay and his team. We are ideally positioned to create exceptional shareholder value with modest risk and volatility while diligently managing risk on both sides of the balance sheet.”
Rosh Re will underwrite global and diverse specialty casualty lines of reinsurance business, the company said.
It will also provide these bespoke rehabilitative solutions, which it says are designed “to help insurers leverage surplus relief and free their capital to deploy in the hardening market.”
These typically longer-tailed lines of reinsurance provide investment float that is typically longer-term in nature, so enabling asset managers to allocate them to differentiated strategies, in an effort to outperform on both sides of the book.
As it looks to generate value, Rosh Re’s capital and premium will be invested in Rosh Capital Management LP’s portfolio of diversified, uncorrelated asset managers as it looks to create an outsized return opportunity on the investment side of the reinsurance business as well.
Michael Jacobs, founder and CEO of Rosh Capital Management, has a long history in the alternative investments space and building institutional grade multi-billion asset management platforms, including Fundamental Advisors LP.
He’s clearly had an eye on the reinsurance space for some time, recognising the potential to deliver long-term, stable assets to investment strategies and given the hardening now seen, feels the time is right to launch.
For the cornerstone investor Kumar, this is an opportunity to both source reinsurance linked returns, as well as to benefit from a direct route to gain leveraged exposure to the premier alternative investment managers and hedge funds that Rosh Capital will allocate to.