Validus Launches ‘AlphaCat Re 2011’ Sidecar

June 2, 2011

Bermuda-based Validus Holdings has joined with other investors in capitalizing and launching AlphaCat Re 2011, Ltd., which it describes as a “new special purpose ‘sidecar’ reinsurer formed for the purpose of writing collateralized reinsurance and retrocessional reinsurance.”

Vaidus said “AlphaCat Re 2011 will provide capacity through ultimate net loss, index based and reinstatement premium protection products.”

The sidecar was funded in May 2011 with $180 million of contributed capital, and commenced “deploying capacity for the June 1, 2011 renewal season and has underwritten a portfolio of contracts as of that date,” said the bulletin.

“AlphaCat Re 2011 will write business for an initial risk period of June 1, 2011 through December 31, 2012, which may be extended under certain circumstances. Validus Underwriting Services, Ltd. will underwrite business for AlphaCat Re 2011, for which it will be paid a commission for originating the business and a profit commission based on the vehicle’s underwriting results for the 2011 and 2012 underwriting years.”

Validus said it has “invested $50.0 million in AlphaCat Re 2011’s common equity, with other common and preferred share investors subscribing for the remainder of AlphaCat Re 2011’s capital. Private investment funds or accounts managed by and under the control of Serengeti Asset Management LP served as lead equity investor in AlphaCat Re 2011.”

Source: Validus Holdings

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