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Lancashire’s equity share placing raises £277 million

10th June 2020 - Author: Luke Gallin

Specialty insurer and reinsurer Lancashire Holdings Limited has announced the successful completion of the placing of new common shares, raising gross proceeds of approximately £277 million as the firm looks to take advantage of improved pricing.

lancashire-logoLancashire revealed yesterday that it was looking to raise fresh capital with an up to £287 million ($365mn)  target for a new equity share placing.

The company has now confirmed that a total of 39,568,089 new common shares have been successfully placed by Morgan Stanley & Co. International plc and Citigroup Global Markets Limited, together with Morgan Stanley (the joint bookrunners), at a price of 700 pence per placing share.

The placing of the shares represent approximately 19.5% of the existing common share capital of the company prior to the placing. Furthermore, the placing price represents a discount of 3.6% to the closing share price of 726 pence on June 9th, 2020. In total, the placing raised gross proceeds of roughly £277 million.

Lancashire notes that it’s pleased by the strong support it has received from both existing and new investors for its capital raise.

The company has now made applications to the Financial Conduct Authority (FCA) for admission of the placing shares to the premium listing segment of the official list of the FCA, and also the London Stock Exchange for admission of the placing shares to trading on its main market for listed securities.

Lancashire’s capital raise follows that of specialty players such as Hiscox, Beazley, and RenaissanceRe. In comparison, Hiscox raised £375 million and Beazley £247 million.

Lancashire has noted accelerating rate increases across many of the lines of insurance and reinsurance business that it operates in, leading it to target an increased balance-sheet size to take advantage of improved market conditions.

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