(Bloomberg) -- Greenlight Capital Re Ltd., the reinsurer whose chairman is hedge-fund manager David Einhorn, erased gains from its 2007 initial public offering price after losses from investments and underwriting.
Greenlight Re declined 2.6% to $19 at 11:59 a.m. in New York, extending its loss to 42% this year. The Cayman Islands-based reinsurer, which counts on Einhorn to oversee its portfolio, sold shares for $19 apiece in its IPO.
Einhorn’s main hedge fund is poised for its second losing year in almost two decades after dropping 21% through November, according to an e-mail sent to clients that was obtained by Bloomberg. Investments in SunEdison Inc., Consol Energy Inc. and Micron Technology Inc. have plummeted this year. Gold, which the money manager uses as a wager that central banks’ stimulus efforts will stoke inflation, has also declined.
Greenlight Re has been unprofitable for three straight quarters, hurt by losses on insurance underwriting and investing. The net loss for the period ended Sept. 30 widened to $219.7 million, or $5.98 a share, from $51.8 million, or $1.40, a year earlier, the company said in October.
Ratings firm A.M. Best lowered its outlook on the company to negative from stable that month, citing risks from an investment portfolio heavily allocated toward equities. The move that could make it harder to win new business, Greenlight Re said at the time.
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