BP Marsh commits $5m to Gambit reinsurance vehicle

BP Marsh & Partners announced on Thursday that it has committed up to $5m to Gambit Risk Finance, a new reinsurance vehicle created to support the growth of its US investee company, XPT Group.

It said Gambit Re would enable XPT’s underwriting arm, Platinum Specialty Underwriters, to provide limited risk capital to selected insurance programmes in its portfolio, operating on a fully collateralised basis.

The AIM-traded firm said the vehicle would initially support five profitable Platinum programmes and is expected to deliver strong risk-adjusted returns.

“This investment is a natural extension of our long-standing partnership with XPT,” said chief investment officer Dan Topping.

“Gambit Re enables XPT to demonstrate alignment with its carrier partners and expand its Platinum underwriting footprint with greater flexibility.

“The initiative aligns with our approach of backing entrepreneurial management teams with capital solutions tailored to their growth ambitions.”

BP Marsh said it would take an 8% preferred equity stake in Gambit Re, carrying an 8% preferred annual return.

The vehicle’s $60m capital structure also included $45m from Accord Capital Investments and $10m from RSP, a vehicle formed by XPT senior management.

Platinum would manage the entity, with reinsurance administration outsourced to Bermuda-based Atlantic Security.

“Gambit Re allows us to demonstrate conviction in our Platinum underwriting programs and provide our partners with added confidence through aligned capital,” commented XPT chief executive Tom Ruggieri.

“We value the partnership with BP Marsh and are excited to move forward together.”

At 1123 BST, shares in BP Marsh & Partners were up 0.02% at 705.13p.

Reporting by Josh White for Sharecast.com.