Ratings agency A.M. Best Co. on Tuesday said Bermuda-based Endurance Specialty Insurance Ltd.'s financial strength rating of A (Excellent) would not be affected by its decision to buy back 2 million shares from an original investor.

Endurance said on Monday that it was buying the shares back from Lightyear Capital for $64.7 million using existing cash in hand.

Endurance also announced it would buy back 2 million shares in the open market or through privately negotiated transactions.

A.M. Best expects that Endurance Specialty will continue to manage its capital base conservatively and within an acceptable range supportive of its current financial strength rating.

Following the $64.7 million share repurchase, Endurance's risk-based capital score continues to meet the more stringent requirements established for Bermuda start-up entities, A.M. Best said.

The repurchase of Lightyear's investment is the latest by Bermuda's post-September 11 start-ups as original investors in the companies look to take profits on their investments.

Share buy-backs can also help to drive a company's share price up as the supply of available shares is cut back.