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Fidelis and Ascot add to insurance capital influx

Raising capital: Richard Brindle, chairman and group CEO of Fidelis (File photograph)

Fidelis and Ascot Group have added a combined $585 million to the capital flowing into the re/insurance market.

Ascot yesterday priced a $400 million debt offering of ten-year senior notes at 4.25 per cent.

Fidelis said today it had raised $185 million in a combination of debt and equity capital, taking the Bermudian-based re/insurer’s total new capital raised this year to $1.3 billion.

Rising re/insurance prices across many lines of business have prompted many companies to raise capital to increase their capacity to write new business.

Much of the new money has come into the Bermuda market and several new companies have established on the island.

Joe Roberts, group chief financial officer of Ascot, which has underwriting platforms in Bermuda and in the Lloyd’s of London market, said: “Ascot is pleased to see growth opportunities in all of our key insurance markets.

“This debt raise provides us with the financial flexibility to pursue these opportunities and to continue to support our clients’ growing re/insurance needs.

“This new debt capital diversifies our capital base and introduces new investors to the Ascot journey. We’re delighted by the investor support of this inaugural issuance, and we look forward to continuing on our mission of operating a pre-eminent specialty risk assumption organisation.”

Ascot’s offering is expected to close on December 15. Ascot, a global specialty re/insurer with underwriting platforms in Bermuda and at Lloyd’s, is owned by CPP Investments, which invests the assets of the Canada Pension Plan.

Fidelis said during the fourth quarter it had raised $60 million of equity capital from existing and new investors, including Alfa Insurance and affiliated companies, with which Fidelis has a longstanding relationship.

Fidelis raised an additional $125 million from institutional investors through a sale of debt.

Richard Brindle, chairman and chief executive officer of Fidelis, said: “We are very pleased to have Alfa as our latest equity investor. We have built a strong relationship with the Alfa team over the years through their quota share support of our underwriting and our participation on their treaties. Their equity investment further cements our partnership and long-term relationship.

“Having raised over $1.3 billion of capital in the past year, we have been able to take advantage of the hardening market conditions and have the financial and human resources to continue to build on our existing portfolio in 2021.”

John Hemmings, senior vice-president, CFO and chief investment officer of Alfa Insurance said: “We are excited about this opportunity to broaden our relationship and expand our partnership with Fidelis as equity shareholders. We have great respect and admiration for the Fidelis management team’s proven track record and have great confidence in their ability to generate successful growth and financial strategies in the future. Alfa Insurance seeks to be a long-term partner and is dedicated to helping Fidelis build a successful and profitable company.”

Fidelis’s debt issuance is in the form of 6.625 per cent fixed-rate reset junior subordinated notes, due 2041.

The $1.3 billion of capital Fidelis has raised this year has more than doubled its total capital to $2.4 billion.

Fidelis, a privately owned company formed in 2015, has a staff of more than 40 at its Bermuda headquarters and also has a presence in London and Dublin.

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Published December 10, 2020 at 12:53 pm (Updated December 10, 2020 at 12:52 pm)

Fidelis and Ascot add to insurance capital influx

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