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Weak appetite forces Swiss Re to halt flotation.


SWISS Re has put off its plans for a PS3.3bn listing of its British life insurance arm Reassure in the wake of weak investor demand.

The reinsurance giant yesterday blamed "heightened caution and weak underlying demand" from institutional investors for the postponement of its initial public offering (IPO).

Trading in the shares, which were set to be valued at a price range of between 280p and 330p, was expected to begin this week.

The suspension underlines current investor jitters in the wake of political uncertainty within Europe, which has partly driven a recent spate of disappointing high-valued IPOs from companies such as Funding Circle and Aston Martin.

Trainline, which listed last month, was one rare bright spot among businesses that have gone public in London recently, with its shares up roughly six per cent since the IPO price of 400p.

Refinitiv data released earlier this month showed that a European shortage of flotations dragged global share listings down to a three-year low during the first six months of this year.

Proceeds from global listings hit $62.8bn (PS50bn) in the year to July, crashing from $90.5bn when compared with the same period in the previous year.

Swiss Re's finance chief John Dacey said in a statement yesterday: "While we firmly believe that the long-term interests of Reassure are best served by a more diversified shareholder base, there has been no pressing need for Swiss Re to divest shares at a price that we consider to be unrepresentative of Reassure's value and future prospects."

He added: "We retain our objective to reduce Swiss Re's ownership in order to de-consolidate Reassure."

Proposals for the IPO included Swiss Re slashing its own holding in Reassure, which is Britain's sixth biggest life insurer, from roughly 75 per cent to under 50 per cent.

The company hired Credit Suisse, Morgan Stanley and UBS to work as joint global coordinators, while BNP Paribas and HSBC acted as joint bookrunners.

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Publication:City AM (London, England)
Date:Jul 12, 2019
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