Corporate Activity and portfolio deployment update (7334V)
January 18 2012 - 2:00AM
UK Regulatory
TIDMCAT
RNS Number : 7334V
CATCo Reinsurance Opps Fund Ltd
18 January 2012
CATCo Reinsurance Opportunities Fund Ltd. ("the Company")
Corporate Activity and portfolio deployment update
To: SFM, London Stock Exchange Date: 18 January 2012
Bermuda Stock Exchange
-- Following the December 2011 issue of $125m C Shares, the
Company has now raised approximately $338 million since launch;
-- Substantially all available capital now deployed across multiple reinsurance counterparties;
-- CATCo Reinsurance Fund, Diversified Fund (the "Master Fund")
2012 investments are all performing in line with expectation, and
in excess of the Company's target returns of LIBOR +12-15% per
annum; and
-- At the date of this announcement, the Master Fund has
deployed over $1.25 billion of retrocession reinsurance capacity in
the market incepting on 1 January 2012.
On 16 December 2011, the Company issued a second tranche of
C-Shares of US$ 0.0001 through a Placing for Shares. As a result,
the Company has raised approximately $338 million since launch.
Similarly, the Master Fund received significant additional direct
investment in its participating shares during Q411 bringing the
total fourth quarter fundraising to over $590 million. The
Company's Net Asset Value growth targets of $150 million by 31
December 2011 and $200 million by 31 December 2012 as stated in the
Original Prospectus have now been achieved.
CATCo Investment Management Ltd. ("CATCo IM"), the appointed
investment manager, in conjunction with CATCo-Re Ltd. ("CATCo-Re"),
a licensed Class 3 Reinsurance Company through which the Master
Fund gains access to all of their reinsurance risk exposures, have
agreed terms on new reinsurance transactions with multiple
reinsurance counterparties that have utilized c. 98% of the
available capital received from the Issue, from the additional
direct investment in the Master Fund and from the rollover of 2011
investments.
At the date of this announcement, the Master Fund's reinsurance
portfolio contains a significantly diverse set of global risk
pillars. The Master Fund's diversified portfolio, including
reinsurance protections, ensures that exposure to a single loss
event, no matter the magnitude of the event, results in positive
gross portfolio returns for investors in the current financial
year, with only slightly negative net portfolio returns possible in
a few scenarios as shown below.
Also, regarding the recent Costa Concordia cruise ship accident
off the Italian coast, the Master Fund has a maximum net exposure
of 3% to Offshore Marine events as shown below. However, based on
the insured loss estimates reported to date ranging from $500
million to $1 billion, the Master Fund would not experience any
losses.
Scenario Analysis
Worst Case Insured Single Loss Event Indicative Annualised Net Return*
No Losses 23%
Guam Wind 22%
Canada Wind 22%
South East Asia Quake 22%
Guam Quake 21%
China Wind 20%
US Severe Convective Storms 20%
US Wildfire 19%
Hong Kong Wind 19%
India Quake 19%
China Quake 19%
South Africa Quake 19%
South Korea Quake 17%
Offshore Marine 18%
US Winterstorm 17%
Europe Flood 16%
Israel Quake 16%
Mexico Wind 14%
Indonesia Quake 12%
Philippines Quake 12%
Taiwan Quake 12%
Central America Quake 14%
Caribbean Quake 9%
New Zealand Quake 8%
Mexico Quake 8%
South America Quake 8%
Caribbean Wind 8%
Australia Wind 5%
Australia Quake 5%
Japan Wind 8%
Europe Quake 3%
Japan Quake 0%
US/Canada Quake 0%
Europe Wind (1%)
US Wind (1%)
*This information is based on research undertaken by CATCo.
CATCo IM may change its opinions and views without prior notice. It
does not constitute investment advice nor is it an invitation to
invest in this company. This is purely a scenario analysis and not
a forecast.
For further information, please contact:
Jason Bibb
Director, Chief Operating Officer
CATCo Investment Management Ltd
Telephone: +1 (441) 531 2227
Email: jason.bibb@catcoim.com
David Benda / Hugh Jonathan
Numis Securities Limited
Telephone: +44 (0) 20 7260 1000
Michael Toyer / John Whiley
Prime Management Ltd
Tel: +1 (441) 295 0329
- ends -
This information is provided by RNS
The company news service from the London Stock Exchange
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