Platinum IPO Launched (Finally)

One of Bermuda’s newest insurers, Platinum Underwriters Holdings Ltd., finally succeeded in bringing its long delayed initial public share offering to market, with an opening price of $23.50 per share for the 30.04 million it’s selling, which will raise $675.9 million.

The St. Paul Companies originally established Platinum as a vehicle to spin-off its reinsurance business. It transferred St. Paul Re and its other reinsurance operations to the company, but will retain a 15 percent stake, with an option to increase it to slightly under 25 percent.

Platinum originally sought to raise up to $1.24 billion in a 40 million share offer priced at between $23 to $26 a share, but was forced to cancel those plans in July when the stock market dropped sharply. It subsequently reduced the share offering and the price to the current level, and raised another $125 million through the private placement of convertible securities.

It also sold 3.96 million shares to RenaissanceRe last month, giving it a 9.9 percent interest, and, assumedly, some control over its operations. Given RenRe’s impressive earnings record that may have been the best move Platinum’s made to date.