Zurich To Divest Re Businesses
London Editor
Zurich Financial Services formally announced last week its intention to divest its third-party reinsurance business through an initial public offering, which is expected to take place in the fourth quarter of 2001.
To facilitate the IPO, ZFS has created a new holding company, called Converium Holding Ltd., for ZFS third-party assumed reinsurance operations. Converium includes Zurich Reinsurance (North America) Inc. and Z?rich R?ckversicherung (K?ln) AG, which have been rebranded Converium Reinsurance US and Converium Germany, respectively, according to a statement from Standard & Poors.
S&P lowered its ratings on Zurich Re (North America) and Zurich Ruck to “single-A plus” from “double A,” as a result of “the impending demerger and the consequent removal of their previously strategically important status to ZFS,” the ratings agency said in a statement from its London office.
Zurich will sell at least 70 percent of Converium, which will be listed in Switzerland. The company also has made a confidential filing with the U.S. Securities and Exchange Commission for a listing with the New York Stock Exchange.
“The IPO of Zurich Re will allow Zurich to retain capital and receive cash from the proceeds,” ZFS said.
S&P has assigned a “single-A-plus” counterparty credit and insurer financial strength rating to Converium Ltd., a wholly-owned subsidiary of Converium Holding Ltd.
Reproduced from National Underwriter Property & Casualty/Risk & Benefits Management Edition, September 10, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.
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