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Conduit joins London market with GBP826mln IPO

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Conduit Holdings Limited (LON:CRE) has joined London’s main market with an GBP826mln initial public offering, one of the largest seen in the UK this year.


The reinsurer issued 164mln shares at 500p each with the order book closing on Tuesday, two days earlier than scheduled.


The newly established company is a reinsurance underwriting business focusing on producing risk-adjusted returns, by writing reinsurance in the property, casualty and specialty classes.


The business plan has a balanced approach to catastrophe risk exposures, generating profit and franchise value through the quality of its underwriting and its select portfolio of high-quality business, Conduit noted.


It is targeting to pay 5-6% of equity capital as dividends as early as next year.


It will be led by industry veterans Neil Eckert and Trevor Carvey.


“Years of high insured losses, diminished reserves and the more recent losses and industry strain caused by Covid-19 and severe capacity shortages in certain classes of insurance and reinsurance have produced major corrections in reinsurance pricing and policy Terms & Conditions,” the firm said in a statement.


“Against the industry background of losses, litigation and capacity constraint, as a new business, Conduit has no legacy exposure and, following the Offer, its strong and unencumbered balance sheet will be fully available to write new business in what the Founders believe to be an attractive market environment.”

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