Third Point Re gains ground

Following its initial public offering, Third Point Re’s share price has risen from an initial $12.50 per share, to $13.16 as of 21 August following early trading, according to data from the NYSE.

This will provide some cheer at Third Point Re, which saw its IPO listed at the lower end of its suggested price range, with the IPO raising some $276 million for the reinsurer.

According to data from Capital IQ Third Point Re is now trading slightly above price-to-book – 1.06 as of 21 August – which is likely to reflect the company’s emphasis upon Third Point-backed investment returns and increased investor confidence in the re/insurance sector, which has seen many Bermuda players price-to-book ratio rise in recent months.

The reinsurer has a market capitalisation of $1.04 billion according to Capital IQ, placing it—at least at present—at the lower end of what many in the industry would regard as the necessary size to operate as a global reinsurer. The company will be looking to leverage the experience and underwriting expertise of John Berger—formerly of Alterra—and the investment nous of Dan Loeb and Third Point to build the reinsurer in tough market conditions characterised by high levels of market capitalisation, troubled investment returns and rising convergence market interest.