Brit Insurance has sold 56% of its majority shareholding in electronic trading platform, RI3K, after a week of speculation.
The UK insurer sold 10,338,000 of its shares in RI3K for £8.3m to a consortium of investors comprising of Eton Park, Numis Corporation, IPGL Insurance Services and Neil Eckert.
Brit, which has backed RI3K since its establishment in May 2000, has reduced its shareholding from 86% to 19.9% on a fully diluted basis.
The transaction follows the recent announcement that RI3K has signed a long-term contract to provide paperless trading to Lloyd's of London, after a successful implementation for the new Lloyd's China venture based in Shanghai. In addition, US broker Aon, the world's largest insurance intermediary, has also contracted with RI3K to trade from London.
“Migration to electronic trading at the London Stock Exchange increased volumes and remains a key factor in the City being the global centre it is today. The same is happening in insurance,” said RI3K's Chief Executive, Alex Letts. “As the insurance industry faces its own transformation, this investment in RI3K secures vital infrastructure for the long haul.”
Michael Spencer, chairman of IPGL added: “It is very exciting that this investment will help take RI3K on to the next stage of its development. The insurance market is primed and ready for paperless trading and we can help RI3K add real value to the global insurance marketplace.”
The deal completes Brit's stated strategy of divesting its non-core interests, which included the sale of its shareholding in fund manager Epic Investment Partners to Syndicate Management for around £5.5m in January.
Brit Insurance chief executive Dane Douetil said: "The sale of our majority stake in RI3K achieves our objective of focusing our business on its core activities.
"Furthermore, this transaction represents a significant step in the development of RI3K. Our continuing interest in the company is testament to our belief in
its successful future."
