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Swiss Re’s ReAssure to be valued at up to £3.3bn on LSE IPO

Swiss Re's ReAssure to go ahead with IPO on LSE

The offer is expected to deliver a free float of 26% of ReAssure’s issued share capital

ReAssure is planning to go ahead (IPO) on the London Stock Exchange. Swiss Re’s ReAssure will be valued at up to £3.3 billion when it floats on the London Stock Exchange (LSE), Reuters reported.

ReAssure sets a price range of £2.80 to £3.30 for shares in the IPO. The price range implies a market capitalisation of £2.8 billion to £3.3 billion for the ReAssure IPO due to take place next month.

It is expected that the offer will deliver a free float of 26 per cent of ReAssure’s issued share capital. Shares representing up to 15 per cent of the initial offer will be made available as an over-allotment option, which could take the free float up to nearly 30 per cent.

ReAssure CEO Mark Hodges told Insurance Journal that,” the deal would allow ReAssure to pursue growth going forward, knowing that we have two anchor shareholders.”

An IPO prospectus is also expected to be issued soon, as it awaits Britain’s Financial Conduct Authority’s approval.

£1.325 billion will be paid by ReAssure as dividends over the next five years. An interim dividend for 2019 will be available to the new as well as existing shareholders after the IPO.

Under the flotation plans, Swiss Re will no longer be the major stakeholder in ReAssure and will cut its stake from 75 per cent to below 50 per cent. Japan’s MS&AD Insurance Group, which owns 25 per cent stake will retain its stake.

The decision to be listed in the London Stock Exchange comes after the reinsurer spoke about the importance to have access to new capital to acquire additional closed books, according to Reuters.

According to Insurance Journal, Swiss Re and MS&AD would inject £481 million pounds in new capital into ReAssure ahead of the IPO.

Also, according to Reuters, the joint global coordinators of the ReAssure IPO are Morgan Stanley, Credit Suisse, and UBS, while BNP Paribas and HSBC are acting as joint bookrunners.

Swiss Reinsurance Company, founded in 1863 is the world’s second largest reinsurer.

ReAssure is Britain’s sixth-largest life insurer and has £68.7 billion of assets under administration and focuses on so-called closed book policies.

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