Best Comments on Endurance Share Buyback

A.M. Best Co. has issued a comment on the financial strength rating of “A” (Excellent) of Endurance Specialty Insurance Ltd. and its affiliated companies, indicating that it “remains unaffected following the announced capital management initiatives” of its Bermuda-based parent company, Endurance Specialty Holdings Ltd. The rating outlook remains stable.

“The capital management initiatives involve the repurchase of approximately two million ordinary shares held by initial investor, Lightyear Capital, for $64.7 million and board authorization to initiate a share buyback program,” Best noted. “Endurance used existing cash on hand to fund the $64.7 million share repurchase. Under the share buyback program, Endurance may periodically repurchase up to two million ordinary shares and share equivalents in the open market or through privately negotiated transactions. The timing of any share repurchase is to be predicted on market valuation of the company’s shares and internal capital requirements.”

Best also said it “expects that Endurance Specialty will continue to manage its capital base conservatively and within an acceptable range supportive of its current financial strength rating. It noted that “following the $64.7 million share repurchase, Endurance’s risk-based capital score continues to meet the more stringent requirements established for Bermuda start-up entities, and said it would “closely monitor Endurance Specialty’s capital adequacy as Endurance shares are repurchased.”