Bermuda based hedge fund backed reinsurer Third Point Re, has hit the news in recent days as speculation mounts about a forthcoming initial public offering (IPO). The reinsurer, backed by Dan Loeb’s Third Point LLC hedge fund, institutional investors and contributions from partners such as insurer Hiscox, intends to IPO to raise additional funds according to reports, something that was always expected by many in the market.
Market observers have speculated about a Third Point Re IPO ever since the reinsurer launched, expecting it to go down the route favoured by other hedge fund backed reinsurance companies such as Greenlight Re, but now it seems that preparations are underway if a report from the Reuters news agency is accurate.
Reuters said that Third Point Re is working with three investment banks, Morgan Stanley, Credit Suisse AG and JPMorgan Chase & Co, to prepare the ground ready for an IPO which its sources suggest could aim to raise as much as $250m. By floating the business Third Point will be able to attract yet another class of investor to its reinsurance platform, providing more underwriting capacity which in turn will provide it with more investment float.
Third Point Re CEO John Berger suggested that an IPO was in the reinsurers future back in mid-2012. There hasn’t been any official confirmation that an IPO is underway, but given the recent coverage on Reuters it seems that the groundwork is being prepared to make a forthcoming IPO a successful transaction.