Three big IPO filings slipped into the IPO Pipeline in the past three weeks – with the latest one sailing in from Bermuda.Aspen Insurance Holdings Ltd.of Hamilton, Bermuda, plans an IPO with proceeds estimated at $100 million – a placeholder figure. Aspen filed its F-1 (prospectus) on Wednesday, Dec. 20, 2023. The specialty insurance and reinsurance company’s IPO filing follows two deals pegged at $100 million each in the previous two weeks:
– Fractyl Health (GUTS proposed), a Lexington, Massachusetts-based medical therapeutics company developing an outpatient surgical procedure and gene therapy for obesity and Type 2 diabetes (S-1 filed on Thursday, Dec. 14, 2023) and
– Hornbeck Offshore Services (HOS proposed), a Covington, Louisiana-based water transportation company that serves offshore oil drilling sites (S-1 filed in the first week of December – on Thursday, Dec. 7, 2023).
Two of those three new IPO filings splashed down after the Fed’s pivot last week to rate cuts in 2024, which some think could come as soon as March. The Fed’s shift triggered a huge rally in the U.S. stock market. A friendly Fed and a strong U.S. stock market will help set the stage for healthier volume in the IPO market after two painfully slow years.
PE Firm Apollo to Sell a Slice of Aspen
Aspen Insurance Holdings Ltd., owned by Apollo Global Management, a private equity firm, did not show its cards in its F-1 filing. There’s no word from the company on the IPO’s size, no proposed stock symbol and no info on the listing venue.
Goldman Sachs, Citigroup, Jefferies and Apollo Global Securities are the joint book-runners of the IPO.
This will be Aspen Insurance Holdings’ second time around as a publicly traded company. Aspen Insurance was founded in 2002. Aspen’s stock traded on the New York Stock Exchange from 2003 until February 2019, when Apollo acquired Aspen in an all-cash deal that Insurance Journal reported was worth about $2.6 billion at the time.
The Financial Times reported in early December that Aspen Insurance Holdings was aiming for an enterprise value at listing of $4 billion, according to people familiar with the situation. That projected valuation works out to about $1.4 billion more than what Apollo paid for Aspen more than four years ago.
Aspen Insurance Holdings’ primary specialty insurance business “is centered around niche ‘specialty’ lines, such as professional liability, credit and political risk, cyber and environmental, where we can apply our extensive underwriting and industry expertise,” the prospectus says.
“Our opportunistic reinsurance business is centered around both specialty and traditional reinsurance lines where we apply risk selection criteria to create unique risk profiles rather than an index of the market as other larger peers may do,” the prospectus says.
Aspen Insurance Holdings says that it has turned the business around since it was acquired by Apollo in February 2019.
The turnaround involved exiting 12 insurance and five reinsurance lines of business, slashing its property catastrophe exposure and entering into a $3.6 billion loss portfolio transfer (LPT) agreement with Bermuda reinsurer Enstar Group.
For the 12 months that ended June 30, 2023, Aspen Insurance earned net income of $221.6 million on revenue (gross written premiums) of $4.11 billion ($4,112.6 million), according to financial statements in the prospectus.
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