Fidelis aims to raise $88m in IPO
Fidelis Holdings hopes to raise $88 million in its upcoming initial public offering which it hopes to use to take advantage of the hard market, according to its prospectus.
Selling Fidelis shareholders will also look to raise up to $197.5 million in its IPO as the company continues the complex split of the business into a holding company and an MGU underwriting business.
Fidelis anticipates offering just over 5.71 million new shares in the deal, nearly 5.2% of current equity, while existing shareholders unload some 11.29 million shares, a 10.2% stake.
Fidelis will trim the supply of shares if the market offers more than the $17.50 per share mid-point of the $16 to $19 initial pricing target range to prevent the gross proceeds from crossing the $100 million mark.
Existing shareholders may take a gross total of $197.5 million at the $17.50 mid-point price or $214 million at the upper end.
Founder Richard Brindle (pictured), who will lead Fidelis MGU after the split, is selling half of his stake in the company, which would gain him between $30.3 million and $35.9 million based on the the share selling between $16 and $19.
Fidelis intends to use proceeds to invest in key units and to take advantage of the hard market, the group said.
"Fresh capital flow to key subsidiaries, plus existing liquidity "should enable us to take advantage of the ongoing rate hardening in the key markets in which we participate by writing more business under our planned strategy," management said.
Fidelis last clocked in as a $3 billion insurer by gross written premium after 7.6% annual growth from 2021. Q1 2023's $1.25 billion tally was up 28.3% year on year.
The IPO follows a rather complex split of the business between its risk-bearing side and the MGU underwriting business being taken separately by Fidelis founder Richard Brindle.
The Fidelis headed for the NYSE is positioned as a global, specialty insurance provider still holding exclusive right of first access to the MGU’s under a ten-year framework deal between sides.
J.P. Morgan, Barclays and Jefferies are acting as joint lead bookrunning managers with Keefe, Bruyette & Woods, BMO Capital Markets, Citigroup, UBS, JMP Securities and Dowling in on the deal.
