Investors seeking more exposure to the growing specialty insurance sector have a new initial public offering (IPO) to add to the watchlist.
Jacksonville-based specialty insurer Fortegra registered an S-1 with the Securities and Exchange Commission (SEC) on Wednesday, November 8. It aims to list on the New York Stock Exchange (NYSE) under the ticker “FTG.” It has not yet released pricing details for the offering; instead, it cites the placeholder sum of $100 million.
Goldman Sachs, JPMorgan, Jefferies, and Barclays are joint underwriters for the deal.
The company is owned by Connecticut-based investment company Tiptree, which announced its intention to float Fortegra at its recent quarterly earnings call on November 1. Tiptree expects to keep majority ownership of Fortegra.
This is not the first time Fortegra has registered for a public deal.
The company filed an S-1 back in March 2021. However, Tiptree later withdrew the registration after not getting the price it wanted.
Nor is it the first time Fortegra has appeared on public markets. The firm first launched on the NYSE back in December 2010, floating 6 million shares for $11 each, raising $66 million. There is stayed until 2014 when Tiptree took it private.
Fortegra has a long legacy in the southern United States. It began life back in the 1970s as “Life of the South” – a highly geographically-specific regional monoline insurer. It later rebranded itself to Fortegra (an amalgam of the words fortitude and integrity) in 2003 when current CEO Richard Kahlbaugh joined as Chief Operating Officer.
The company boasted profits of $82 million for the year that ended September 30, 2023, with net revenue of roughly $1.5 billion. It boasted over $3 billion in gross written premiums and premium equivalents (GWPPE) for the period, representing a stunning compound annual growth in total premiums of 27 percent.
Insurance Double Deal?
Fortega’s renewed push for public launch comes on the heels of news that iHamilton Insurance Group is preparing its own IPO. Bermuda-headquartered Hamilton is aiming to raise up to $270 million in a deal that could see it notch a valuation of roughly $2 billion.
The two deals together could serve as a litmus test for investor demand for the sector. Insurance has done quite well this year, with the S&P Insurance Select Industry Index rising over 5.5 percent year-to-date.
Although some market newcomers are trying to forge a path forward, the broader IPO recovery is far from out of the woods. Recent high-profile debuts, from Instacart to Birkenstcok, have taken a battering, with sharp price declines after listing.
Interested investors will likely consider the IPO climate, the outlook for the specialty insurance sector, the fundamentals of Fortega’s business, and its future management structure in relation to Tiptree, another publicly traded company.
This article was produced and syndicated by Wealth of Geeks.