21 May 2014 Insurance

Under fire Aspen woos shareholders with presentation

As it continues to grapple with hostile overtures from Endurance, the board of under-pressure re/insurer Aspen has sought to reassure shareholders by publishing an investor presentation detailing its progress and plans for what it describes as the pursuit of an ambitious growth strategy.

The unsolicited $3.2 billion bid to buy the firm by Endurance earlier this year sparked a very public and bitter war of words between the companies after the Aspen board rejected the offer.

The Aspen presentation outlines a path for delivering further growth in operating return on equity and shareholder value.

It said its long-term focus is on the creation of shareholder value and has generated over $3 billion in capital over the last 10 years while developing an increasingly diverse mix of business. Aspen’s gross written premiums for the 12 months ended March 31, 2014 were $2.7 billion.

The firm said it is already benefitting from its prior investment in building a US specialty insurance platform and it hopes the restructuring of its ceded reinsurance and retrocessional programmes will deliver an estimated $25 million benefit to its net income in 2014 and a further $20 million in 2015.

Aspen believes it will continue to benefit from its well-established Lloyds platform and a reinsurance business that it said is well positioned for continued profitable growth.

Chris O’Kane, chief executive officer of Aspen, said: “Aspen is executing on a clear strategy for delivering superior performance, as evidenced by strong results across all parts of our business in the first quarter, with a resulting annualized operating ROE of 14.8 percent.

“Aspen is at an inflection point where the significant investments we have made over the past several years are now paying off. As a result, we are well positioned to achieve our 10 percent operating ROE objective in 2014 and to deliver on our expectation that 2015 operating ROE will increase in the order of 100 basis points from 2014.”

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