Beazley PLC (LON:BEZ) has raised £247mln to shore up its balance sheet and fund future growth opportunities amid the coronavirus (COVID-19) pandemic.
Over 78mln shares were placed at 315p each, a 4.9% discount to Monday’s closing price, representing 15% of the company’s total issued share capital. Eight of the company's directors subscribed for over 210,000 shares.
READ: Beazley eyes US$170mln of insurance claims from coronavirus pandemic
The Lloyds of London insurer said it expects to receive US$170mln in claims related to the coronavirus pandemic, after posting a US$55mln investment loss in the quarter to March 31, 2020.
The FTSE 250-listed firm has also increased its banking facility to US$450mln from US$225mln which, alongside the placing, is expected to increase half-year surplus capital to 35%.
No interim dividend will be paid following the share placing.
“The capital raising makes sense and places the company on a firmer footing,” analysts at Peel Hunt commented in a note to clients. “We estimate the capital raising will be dilutive as Beazley will initially retain capital to absorb losses rather than grow the top line.”
Shares jumped 10% to 363.4p on Tuesday in early trades.