SiriusPoint Ltd (NYSE:SPNT) stock is trading higher on Tuesday after the specialty insurer and reinsurer announced the repurchase of all SiriusPoint common shares and warrants held by CM Bermuda Limited for $733 million.
Following the closing of the repurchase transaction, CM Bermuda will have no remaining ownership interest in SiriusPoint and will cease to have any representation on, or observer rights with respect to, SiriusPoint's board of directors.
SiriusPoint will pay in two tranches, with the first payment of $250 million immediately. The transaction is expected to close on or before February 28, 2025, at which time SiriusPoint will make a second payment of $483 million to CM Bermuda.
SiriusPoint has financed the transaction entirely using its existing capital. Its proforma Bermuda Solvency Capital Ratio at the end of the third quarter remains strong at 218% after the payments.
The company has agreed to repurchase 45.7 million common shares at $14.25 per share.
It also agreed to repurchase and surrender 21 million warrants at $3.56 per warrant (strike price of $11 per warrant).
SiriusPoint CEO Scott Egan said: "Today's announcement to repurchase all shares and warrants owned by CM Bermuda is a significant development for SiriusPoint. Our financial position, driven by our strengthening profitability and performance, has empowered us to execute this transaction."
"The transaction will be meaningfully accretive to earnings per share and return on equity and accretive to book value per share. The closing of the transaction positions SiriusPoint well for the future. We enter 2025 with great momentum and remain focused on driving further value creation for all shareholders."
Price Action: SPNT stock is up 13.8% at $16.16 at last check Tuesday.
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