Bullish Hiscox seeking £110m

12 April 2012

LLOYD's of London insurer Hiscox is planning to tap investors for more than £110m. The company, currently valued at £271m, said it wanted to exploit strong trading conditions.

'In my 38 years in the market I have never known conditions as good as this,' said chairman Robert Hiscox. 'Hiscox has taken full advantage with every penny of its existing capital and needs more as good profitable business is there for the taking.'

It is offering one new share for two held at 120p a shot, a 21% discount to the closing price on Monday. The stock fell 11 1/2p to 141p on the news, despite Hiscox's decision to reintroduce the dividend and prediction that strong conditions would continue through 2003.

The rights issue, fully underwritten by ING Barings, comes less than a year after Hiscox raised £54m by selling new shares. It wanted the money to cash in on the surge in premiums following the terror attacks of 11 September. The attacks on the World Trade Centre cost the company £30m and investors last year's dividend.

In its latest statement, Hiscox said pre-tax profits had risen to £3.9m for the six months ended June, from £1.4m a year earlier. The dividend was set at 1.2p a share. Gross written premium income rose 41.3% to £442.3m.

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