Bermuda-based Hamilton Insurance Group Ltd. is planning an initial public offering (IPO) to raise up to $270 million, offering 6.25 million Class B shares and 8.75 million shares from existing shareholders priced between $16 to $18 each. This move could value the global specialty insurer at approximately $2 billion, according to details released today.
The IPO comes during a tumultuous period for US IPOs, with companies such as Arm Holdings (NASDAQ:ARM) Plc and Birkenstock (NYSE:BIRK) Holding Plc experiencing lackluster debuts. Other firms, including BrightSpring Health Services Inc. and Rubrik Inc., are reassessing their IPO schedules due to market volatility, high interest rates, and geopolitical tensions in the Middle East. Waystar Holding Corp., owned by EQT AB (ST:EQTAB), has also postponed its investor roadshow and offering until December.
Hamilton Insurance Group was founded in 2013 by CEO Ms. Giuseppina (Pina) Albo and has since grown into a global specialty insurer handling insurance and reinsurance risks. The company targets large global enterprises for its specialty and casualty insurance services and U.S.-based firms for its excess & surplus offerings.
Despite declining revenues, the company has managed to reduce its General and Administrative expenses. According to recent financial results, Hamilton reported lower cash flow from operations and a free cash flow of $1.1 billion for the twelve months ending June 30, 2023. As of the same date, Hamilton had $925.2 million in cash and total liabilities of $4.5 billion.
Hamilton plans to use the IPO proceeds to make capital contributions to its insurance and reinsurance operating subsidiaries. The firm's exposure to legal proceedings is not clearly defined by management.
The global specialty insurance market is projected to reach $279 billion by 2031 with a compound annual growth rate (CAGR) of 10.6% from 2022. Barclays (LON:BARC) Plc and Morgan Stanley (NYSE:MS) are leading the IPO, with several major banks and securities firms acting as bookrunners.
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