Lloyd's vehicle Helios eyes £20m capital raise to target hard market

Lloyd's investment vehicle  Helios Underwriting is looking to raise £20 million through a share issuance to take advantage of the "attractive opportunities for growth and shareholder value enhancement" in the hardening market.

The company said that discussions with potential investors have crystallised around an issue price of 120 pence per share, being a discount of approximately 42 percent to adjusted net asset value, but a premium of approximately 25 percent to the closing mid-market price on October 6, 2020.

As part of the fundraising, the company intends to enter into conditional agreements with its chief executive Nigel Hanbury and chief financial officer Arthur Manners to acquire a limited liability vehicle (LLV) from each of them for a combined consideration of £5.5 million.

Helios said the acquisitions are in line with its strategy to increase its underwriting capacity, but also enables Hanbury and Manners to continue to invest in the company.

The fundraise will allow Helios to finance the additional capital required to fund the increase in its capacity from pre-emptions, make further LLV acquisitions, and to participate in upcoming capacity auctions.

Hanbury, chief executive of Helios, said: "We are most encouraged by the progress we have made on the potential fundraising thus far, and by the significant interest we have seen from well-known and respected insurance specialist institutions.

"We remain convinced that this is a period of unprecedented opportunity for Helios, with a hardening market coupled with the opportunities we see to increase capacity from pre-emptions, make further LLV acquisitions and participate in capacity auctions, all of which would be value enhancing for our shareholders."