The Board of Directors of Blue Capital Reinsurance Holdings Ltd. has announced that, after considering strategic alternatives, it’s been decided to stop all active operations and pursue an orderly run-off.
The firm is to pursue the run-off of all of its liabilities and in-force portfolio and return capital to shareholders as it winds up its operations.
Blue Capital explains that it will remain exposed to the performance of underlying reinsurance treaties that remain in-force, and the future release of collateral held in trust under the terms of underlying expired reinsurance treaties during the run-off period.
The company’s Chairman and Chief Executive Officer (CEO), Michael McGuire, commented: “Recognizing the valuation level of the Company’s common shares in the public markets, the Board of Directors determined that an orderly runoff of the Company’s liabilities and return of the Company’s capital through special distributions is the best course of action to maximize value for our shareholders.”
In accordance with regulatory requirements, Blue Capital notes that it expects to declare special contributions to shareholders as it winds up its operations.
Blue Capital states that it currently expects that 20% of its existing shareholders’ equity, as of June 30th, 2019 will have been distributed or will become available for distribution in the remainder of 2019, while 65% will become available for distribution in 2020, and 15% will become available after 2020.
Currently, Blue Capital intends to delist its common shares from the New York Stock Exchange and the Bermuda Stock Exchange before March 31st, 2020.