Third Point Re, the Bermuda domiciled reinsurer backed by Third Point LLC hedge fund owner Dan Loeb, has increased the offering size of its long-awaited IPO to a maximum of $345m. When Third Point Re initially filed its IPO documentation it was hoping for an offering of $250m but it seems demand has allowed it to increase the target.
An updated S-1 registration statement document which was filed with the U.S. Securities and Exchange Commission yesterday, shows the proposed maximum aggregate offering price as $345m, up by 38% from the initial $250m target, according to Bloomberg news and the Royal Gazette Bermuda.
This has not come as a surprise given the demand for investments linked to the returns of the reinsurance market at the moment. We suggested when we wrote about the initial IPO filing earlier this month that the $250m should not be seen as a maximum offering and that if it was able to we would expect Third Point Re to increase that should investor demand allow.
The aim of the IPO is to raise additional third-party investor capital in order to increase underwriting capacity at Third Point Re. At the same time this will help it to increase the investment assets, or float, that is fully invested and managed by Dan Loeb’s Third Point LLC hedge fund.
Third Point Re launched with $750m of capital, seeded by Loeb’s Third Point hedge fund. It also operates an investment management arm, Third Point Reinsurance Investment Management Ltd., a catastrophe investment fund, the Third Point Reinsurance Opportunities Fund Ltd., which it launched with a partner investment from re/insurer Hiscox and its reinsurer Third Point Re Cat Ltd.
Third Point Re reported revenues of $114.2m in the first quarter of 2013, income of $74.4m, compared to income of just over $94m in 2012. Third Point Re has increased its focus on casualty risks in 2013 and seeks to offer third-party investors a slightly different, perhaps more balanced risk profile than the more typical peak catastrophe reinsurance risks that ILS firms tend to offer.
More details on the Third Point Reinsurance Ltd. IPO can be found in our article from earlier this month.