Consortium acquires 56% shareholding in trading platform for £8.3m
A consortium of investors will inject £5m into electronic trading platform, RI3K, as it bids to grow its direct insurance business.
The move comes after IPGL, a private holding company of which Michael Spencer, chief executive of ICAP, is the major shareholder, acquired a controlling interest in the company from UK insurer Brit.
Brit will retain a 19.9% stake in RI3K.
RI3K, which until now has predominantly serviced the reinsurance sector, intends to refocus its attentions on syndicates and insurers in the Lloyd's and London market.
IPGL joined forces with investment fund Eton Park, investment banking and broking group Numis Corporation, and Climate Exchange chief executive Neil Eckert, to acquire the 56% shareholding for £8.3m. The consortium promised to inject significant capital.
“We have now got access to some extraordinarily good working capital going forward
Alex Letts, chief executive of RI3K
Alex Letts, chief executive of RI3K, told Insurance Times: "We have now got access to some extraordinarily good working capital going forward, which secures the long term future of the company.
"We intend to work with those syndicates who are, after all, the heartbeat of the market. Our responsibility is to make sure that those people have something that works for them rather than imposing something that works for us."
The deal, which forms part of Brit's stated strategy to sell off its non-core activities, marks a turning point for RI3K, following the recent announcement that it will provide paperless trading to Lloyd's China venture.
But, Letts dismissed suggestions that he would benefit financially from the deal and insisted he was not about to sell his stake in the company.
"We feel we have three to four years to run and hopefully at the end of that we will see the upside," he said. "There is still a lot of work to be done and we intend to stay in it for the long haul."