Danish Re Bermuda Ltd was this week assigned an indicative financial strength of A- (Excellent) by AM Best.

Danish Re Bermuda is a global reinsurer that underwrites at Lloyd's as an Integrated Lloyd's Vehicle and through its fully licensed Bermuda risk carrier.

The rating is subject to the full completion of a $200 million private equity placement offer, which is expected by the end of January 2002.

Danish Re's investor, Trident II, LP, a $1.4 billion private equity fund managed by MMC Capital, is subscribing to the private offering.

The rating is said to reflect the company's carefully managed growth since its formation in November 1999, in anticipation of an upturn in the reinsurance market, excellent prospective capitalisation and strong financial performance and business profile.

Danish Re Cayman Holding Ltd., the holding company, is to initially receive the $200 million capital injection, which AM Best expects to be downstreamed to Bermuda.

AM Best said the additional capital, which should take Danish Re Bermuda's capital base to approximately $250 million, will increase the underwriting capacity of the group's non-Lloyd's operations while benefiting from Bermuda's beneficial tax and regulatory regime.

As a consequence of the capital injection, Danish Re's capitalisation, which is measured by AM Best's capital adequacy model, will be consistent with the A- rating.

AM Best is said to be one of the world's oldest and most authoritative insurance rating companies. AM Best was established in 1899.