Platinum’s Ratings Remain on CW Positive Pending RenRe Acquisition: S&P

Standard & Poor’s Ratings Services has maintained its ‘BBB’ long-term counterparty credit rating on Bermuda-based Platinum Underwriters Holdings Ltd. on CreditWatch with positive implications.

S&P has also maintained its ‘A-‘ counterparty credit and financial strength ratings on Platinum’s operating subsidiaries on CreditWatch positive. The rating actions were initiated in November, when RenaissanceRe Holdings Ltd. entered an agreement to acquire Platinum for $1.9 billion in cash and stock.

“Our placement of our ratings on Platinum on CreditWatch reflects the potential support we believe the company will receive as an important part of RenaissanceRe’s specialty strategy and the overall RenaissanceRe group,” said credit analyst Taoufik Gharib.

“The historically profitable casualty book would contribute meaningfully to RenaissanceRe’s profits. Over time, Platinum may also benefit from the enterprise risk and managerial resources at RenaissanceRe upon full integration of its risk systems and underwriting platforms. Given the affiliation to the RenaissanceRe brand and a larger balance sheet, we think the company could also solidify its competitive position,” he added.

Gharib also indicated that S&P’s ratings on Platinum “are still on CreditWatch with positive implications, reflecting the potential improvement in credit quality of up to two notches created by becoming a part of RenaissanceRe’s specialty strategy upon consummation of the proposed acquisition within the next three months. Specifically, Platinum’s profitable specialty and casualty book would be a beneficial and diversifying addition to RenaissanceRe.”

Source: Standard & Poor’s

Topics Mergers & Acquisitions