The U.S. Securities and Exchange Commission pushed a reinsurer co-founded by billionaire hedge fund manager Dan Loeb to provide more information about investments ahead of last month’s initial public offering.
“Please consider including a tabular disclosure” of holdings that generated net investment income of $136.4 million in 2012, the SEC asked Bermuda-based Third Point Reinsurance Ltd. in a letter dated June 12 and made public Monday. The regulator made more than 60 other requests to make the company’s financial statements more useful for investors.
Third Point Re specified in a subsequent filing that its investment results included $61.5 million in gains from long and short equity strategies, $28.2 million from corporate credit, $18.9 million from asset-backed securities and the rest from macroeconomic and other positions.
The back-and-forth shows the scope of SEC concerns about disclosure. Loeb’s hedge fund invests Third Point Re’s assets and the reinsurer highlighted his track record in the filings. The firm was able to keep some amendments temporarily confidential because it filed as an emerging growth company under the Jumpstart Our Business Startups Act. Revisions were reflected in the reinsurer’s first public filing in July.
The IPO on Aug. 14 raised about $276 million. Shares have climbed 8.8 percent since then, giving the company a market value of about $1.4 billion.
Other points raised by the SEC included the need to define some industry terms and detail some of the costs of becoming publicly traded. The regulator also questioned Third Point Re’s description of Chief Executive Officer John Berger as “one of the leading reinsurance executives of his generation.”
“Please eliminate this type of subjective statement,” the SEC said. “Instead consider providing factual information relating to his accomplishments in prior positions.”
Subsequent filings described Berger as an “insurance industry veteran with over thirty years of experience.”
–With assistance from Lee Spears in New York. Editors: Dan Kraut, Rick Green