Tags: IPO | Loeb | Third | Point

IPO by Loeb's Third Point Re Priced at Low End

Wednesday, 14 Aug 2013 08:30 PM

Third Point Reinsurance Ltd., which counts billionaire hedge-fund manager Daniel Loeb as a founding shareholder, raised about $276 million in an initial public offering, pricing the stock at the bottom of the proposed range.

The company and existing owners sold 22.1 million shares for $12.50 each, according to data compiled by Bloomberg. Earlier it had offered 22.2 million for $12.50 to $14.50. Third Point Re shares are set to start trading Thursday.

Third Point Re, which relies on Loeb’s Third Point LLC to oversee an investment portfolio valued at more than $900 million at midyear, will use proceeds from the IPO to boost underwriting capacity. Loeb’s money-management style sets Third Point Re apart from peers by diverging from the typical approach of investing mainly in fixed-income, the reinsurer said in regulatory filings.

“Our investment strategy is intended to achieve superior risk-adjusted returns by deploying capital in both long and short investments with favorable risk/reward characteristics across select asset classes, sectors and geographies,” Third Point Re said in filings.

About half of Third Point Re’s investments were in stocks and 40 percent were in bonds as of June 30, according to filings. Arch Capital Group Ltd., Endurance Specialty Holdings Ltd. and Axis Capital Holdings Ltd., which Third Point Re names as competitors, hold most of their portfolios in fixed-maturity securities, filings show.

Greenlight’s Investments

Greenlight Capital Re Ltd., the reinsurer that funnels its capital to David Einhorn’s Greenlight Capital Inc. hedge fund, holds about 1 percent of its investments in debt securities, according to filings.

Third Point Re posted $100.7 million in net income in the six months through June 30, compared with $99.4 million in all of 2012, as the reinsurer lowered its underwriting costs. The company spent about $1.08 on claims and expenses for every premium dollar it collected in the six months through June 30, down from $1.30 last year, filings show.

Affiliates of private-equity firms Kelso & Co. and Pine Brook Road Partners LLC have some of the largest Third Point Re stakes. Loeb was set to own about 8.5 percent after the offering. Neither Loeb nor the private-equity firms had planned to sell in the IPO.

JPMorgan Chase & Co., Credit Suisse Group AG, Morgan Stanley, Bank of America Corp. and Citigroup Inc. are among the banks managing Third Point Re’s offering. The stock will be listed on the New York Stock Exchange under the symbol TPRE.

© Copyright 2017 Bloomberg News. All rights reserved.

 
1Like our page
2Share
InvestingAnalysis
Third Point Reinsurance Ltd., which counts billionaire hedge-fund manager Daniel Loeb as a founding shareholder, raised about $276 million in an initial public offering, pricing the stock at the bottom of the proposed range.
IPO,Loeb,Third,Point
401
2013-30-14
Wednesday, 14 Aug 2013 08:30 PM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved