Hamilton mulls IPO, sale: Sources

(Reuters) — Hamilton Insurance Group is considering strategic options amid growing momentum for deals involving insurance and reinsurance companies, people familiar with the matter told Reuters.

The Bermuda-based group has been discussing options with potential advisers, including an initial public offering and a private sale, said the people, who spoke on condition of anonymity.

A transaction could value Hamilton at more than $2 billion, one of the people said. The group reported a book value of nearly $1.7 billion at the end of December. Listed peers trade at a premium to their book value.

Deliberations are preliminary and a transaction may not materialize, the people said, with one person suggesting that a deal is more likely to happen after hurricane season ends in November given the company’s underwriting exposure to natural catastrophes.

A spokesperson for Hamilton declined to comment.

The timing of the strategic discussions benefits from a number of industry tailwinds.

Investors have shown appetite in the sector, with shares in Skyward Specialty soaring since their New York debut in January. Reinsurer Everest Re last month successfully raised about $1.5 billion to fund growth. Bermuda-based Fidelis Insurance said in April it planned to seek a U.S. IPO.

Private sales have also returned, most notably the near-$3 billion divestment by American International Group Inc. of its reinsurance unit Validus Re last month to RenaissanceRe.