Acquisition of Lloyd's Member

RNS Number : 2079G

Helios Underwriting Plc

02 May 2014

 



2 May 2014

Helios Underwriting plc

("HUW" or the "Company")

Acquisition of Lloyd's Limited Liability Vehicle

HUW is pleased to announce that, in line with its strategy of increasing underwriting capacity through acquisition, it has agreed to acquire Nomina No 372 LLP, a limited liability member of Lloyd's ("LLV") for a total consideration of £0.5 million in cash.  The 2014 underwriting capacity of the LLV is £1.0 million; this compares with HUW's 2014 capacity of £20.3 million prior to this acquisition.  There is an obligation that Funds at Lloyd's are provided in the amount of £0.5 million which will be supported by funds from HUW and other sources such as the LOC from HUW's quota share reinsurance arrangement.  Completion is subject to change of control consent from Lloyd's, which is anticipated to take place shortly.

The LLV participates in a spread of Lloyd's syndicates broadly similar to HUW's own participation.  It is anticipated that the LLV will be included in the Company's collateralised quota share reinsurance arrangement for the 2014 year of account.

Commenting upon the acquisition, Nigel Hanbury, the Company's Chief Executive Officer, said:

"We are delighted to have agreed a further LLV acquisition which will further increase our underwriting capacity.  This is in line with our stated strategy of acquiring corporate members as suitable opportunities arise.  We continue to believe that there remain significant opportunities for further growth available to the Company."

For further information please contact:

HUW Nigel Hanbury	[e-mail]
Smith & Williamson Corporate Finance David Jones	020 7131 4000
Westhouse Securities Robert Finlay Darren Vickers	020 7601 6100
Haggie Partners Peter Rigby	020 7562 4444

About HUW

HUW provides a limited liability direct investment into the Lloyd's insurance market and is quoted on the London Stock Exchange's AIM market (ticker: HUW). HUW's subsidiary underwriting vehicles trade within the Lloyd's insurance market as corporate members of Lloyd's writing £20 million of capacity for the 2014 account. The portfolio provides a good spread of classes of business being concentrated in property insurance and reinsurance. For further information please visit www.huwplc.com.

Additional information

Nomina No 372 LLP ("Nomina 372") is a limited liability member of Lloyd's; in the year ended 31 December 2012, Nomina 372 made a profit before tax of £0.04 million on gross premiums written of £0.8 million.  Nomina 372's estimated net asset value at completion is approximately £0.5 million (based on 30 September 2013 syndicate forecasts) including an estimated market value of underwriting capacity of £0.4 million.

Set out below is Nomina 372's 2011 closed year of account result and 2012 open year of account forecast:

YOA	Nomina 372 syndicate capacity (£'000)	Previous forecast of syndicate profit (30 September 2013)			Current forecast of syndicate profit* (31 December 2013)
		Mid point (£'000)	Mid point (%)	Range (%)	Mid point (£'000)	Mid point (%)	Range (%)
2011	850	56	6.64%	3.52 - 9.76%	69	8.14%	N/A
2012	885	59	6.63%	3.05 - 10.20%	68	7.69%	4.20 - 11.18%

Source: Syndicate data and HUW analysis

*For 2011 this is the YOA result

Set out below are details of Nomina 372's syndicate participations for the 2011 to 2014 years of account:

YOA	2011		2012		2013			2014
Syndicate	(£'000)	(%)*	(£'000)	(%)*	(£'000)	(%)*		(£'000)	(%)*
33	85	10.0%	93	10.5%	93	10.0%	98		9.6%
218	41	4.9%	37	4.2%	36	3.9%	36		3.6%
386	49	5.8%	56	6.3%	56	6.1%	56		5.5%
510	126	14.9%	134	15.1%	135	14.6%	135		13.3%
557	14	1.7%	13	1.4%	10	1.1%	10		1.0%
570	36	4.3%	-	-	-	-	-		-
609	72	8.5%	110	12.4%	111	12.0%	111		10.9%
623	125	14.8%	125	14.2%	131	14.2%	142		13.9%
727	14	1.7%	14	1.6%	14	1.6%	15		1.4%
958	55	6.5%	29	3.3%	22	2.3%	17		1.7%
1176	22	2.6%	22	2.5%	22	2.4%	23		2.3%
1200	1	0.1%	1	0.1%	0	0.0%	0		0.0%
1729	-	-	-	-	-	-	10		1.0%
2010	47	5.5%	47	5.3%	47	5.1%	47		4.6%
2525	4	0.4%	4	0.4%	4	0.4%	4		0.4%
2526	2	0.3%	1	0.1%	1	0.1%	-		-
2791	133	15.6%	135	15.3%	135	14.6%	119		11.7%
4242	12	1.5%	12	1.4%	12	1.3%	12		1.2%
5820	-	-	-	-	30	3.2%	30		2.9%
6104	-	-	-	-	-	-	20		2.0%
6105	9	1.0%	9	1.0%	5	0.5%	15		1.5%
6110	-	-	21	2.3%	35	3.8%	45		4.4%
6111	-	-	23	2.6%	26	2.8%	27		2.7%
6117	-	-	-	-	-	-	45		4.4%
Totals	850	100.0%	885	100.0%	926	100.0%		1,019	100.0%

* Percentage of total syndicate portfolio

 

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