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(Alliance News) - Randall & Quilter Investment Holdings Ltd on Monday reported it swung to a loss in 2021 and said it plans to raise USD108 million through a share placing and open offer.
The Bermuda-based insurer swung to a pretax loss USD162.0 million in 2021 from a profit of USD38.7 million the previous year.
It posted an IFRS loss after tax of USD127.4 million. R&Q explained that this was primarily due to a USD90 million pretax non-cash charge, which it did not specify, and the transformation of its Legacy Insurance business model from upfront 'day-one' underwriting income to annual recurring fee-income.
The Legacy Insurance business, one of its two businesses, completed 15 transactions in 2021, with gross reserves acquired of USD735 million. Reserves under management stood at USD417 million.
Its Program Management business reported gross written premiums totalling USD1.0 billion in the year. This was nearly doubled from the previous year's figure of USD539 million.
Fee income for the business stood at USD56.1 million, more than double the USD24.1 million achieved in 2020.
Looking forward, the company expects to achieve USD1.8 billion of gross written premiums in 2022 and a pretax operating profit of USD90 million by 2024.
Randall & Quilter said it is raising a minimum of USD100 million via a placing, subscription and open offer. The shares will be offered at a price of 105 pence per share. Shares in R&Q were up 7.8% at 99.20 pence on Monday morning in London.
Members of its board and senior management team intend to subscribe for around USD1.4 million in new shares, and the company also will make an open offer to existing shareholders for up USD8 million.
"We expect to complete our fundraise in the coming weeks, and I have been encouraged by the strong indications of interest we have had from shareholders. This funding will give us the capital we need to de-lever our balance sheet and maintain the strong financial profile that is an important part of our growth," said Chair William Spiegel.
The fund raise follows R&Q shareholders late last month voting to reject a GBP482 million takeover offer from 23% shareholder Brickell PC Insurance Holdings LLC.
Brickell also had committed to provide USD100 million in new equity funding to R&Q to de-leverage its balance sheet, so the equity raise announced on Monday is intended to replace this.
By Heather Rydings; heatherrydings@alliancenews.com
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