The insurance sector continues to provide a good home for investors. The latest to join the line of insurance companies to float this year is Admiral, which has announced its float date: 23 September.
Admiral launched its offer with a price of 245p-300p per ordinary share, valuing the company at £776m. Existing ordinary shares with a value of £229m are to be sold. The price is based on the mid-point of the indicative price range and prior to any over allotment option granted by existing shareholders. These shares represent about 32% of Admiral's issued share capital.
The existing ordinary shares are being sold by Barclays Private Equity (15%), the management and employees of Admiral (12%) and XL Capital (5%).
Analysts have mixed views on how well the float will go, but employees will get a nice windfall.
Champagne swigging at the Monte Carlo Rendez-Vous this week was muted. Lots of reinsurers stayed at home to work out their hurricane losses and others were worried about the troubles of top 10 reinsurer Converium, which came out of Zurich Financial Services in 2001.
S&P downgraded it from A to BBB and Fitch pulled it from A- to BB+. Oh dear.
That takes it off the security list for some of the leading clients and their brokers. And airline insurer Global Aerospace Underwriting Management (GAUM) said it would be reviewing its relationship with the company. Converium provides 27.3% of GUAM's capacity. Who will stay loyal?
The interims keep on coming (see Results in brief on this page). Investors were very impressed with Kiln. Its shares traded at 85.5p on Tuesday, compared to 74p earlier in the month.
Benfield also impressed. Its shares traded at 262p on Tuesday compared to 220p earlier in the month.
