Wellington in reinsurer launch

QUOTED Lloyd's underwriter Wellington has raised £448m to fund a new, non-Lloyd's reinsurer, Wellington Re, which is claimed will be the largest British-based independent of its kind.

The money has been put up by an investor group led by Blackstone and Candover, and which includes CSFB Private Equity, Montpelier Re, 3i, Phoenix Equity, Olympus, Lexicon and Wellington Re management.

Wellington has a right to subscribe £95m for 21% of Re, with an option on a further 7%. Chris O'Kane, Wellington's chief underwriter, is to become chief executive of Re under the chairmanship of Paul Myners, a non-executive director of Marks & Spencer.

Re will concentrate on property, casualty and commercial reinsurance to strengthen the Wellington balance sheet and boost returns for capital providers to Syndicate 2020, of whom Wellington is one.

Wellington lost £73.4m for the year ended December, from a pre-tax profit of £3.9m last time, in part due to a £75m hit after 11 September.