With institutional investors providing the bulk of the capital, RenaissanceRe Holdings has announced the creation of a new joint venture dedicated to casualty and specialty risks.
Launched with $475 million of capital, the venture—Fontana Holdings L.P.—targets institutional investors, who contributed $325 million. RenRe provided the remaining capital.
In conjunction with the launch, Fontana has assumed a whole account quota share of RenaissanceRe’s global casualty and specialty book of business, including the credit portfolio, with the opportunity to raise additional capital and increase in scale over time, RenRe said in a media statement.
Fontana is regulated by the Bermuda Monetary Authority and is expected to be consolidated into RenaissanceRe’s financial statements.
Kevin J. O’Donnell, president and chief executive officer of RenaissanceRe, said, “Fontana builds on our long legacy of innovation in matching desirable risk with owned and partner capital.” Without identifying the investors, O’Donnell described them as “highly respected institutional investors” who will benefit from RenRe’s deep expertise in underwriting casualty and specialty risks.
“We also believe that Fontana will enhance shareholder value by providing a steady source of fee income while enhancing our gross-to-net strategy,” he continued.
Christopher S. Parry, senior vice president and global head of RenRe’s ventures business, Capital Partners, said that “Fontana represents the next step in the evolution of our Capital Partners strategy.”
“As our first joint venture focused on casualty and specialty risk, Fontana extends the suite of insurance-linked securities and reinsurance strategies that we offer our third-party capital partners.”