Orion180 Insurance prices US IPO below range, raises $240 million
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FILE PHOTO: A street sign for Wall Street is seen outside the New York Stock Exchange (NYSE) in New York City, New York, U.S., July 19, 2021. REUTERS/Andrew Kelly///File Photo
Sept 17 (Reuters) - Orion180 Insurance on Thursday raised $240 million in its US initial public offering, which it priced below its targeted range, reflecting caution as investors navigate volatile market conditions.
The Melbourne, Florida-based company sold 20 million shares at $12 apiece, below its indicated price range of $15 to $17.
The fall IPO season has kicked off on a wobbly note, with markets being whipsawed by concerns about a slowdown in AI development, the Federal Reserve's monetary policy tightening cycle and a surge in bond yields.
IPOs typically fare better in stable markets, when companies have greater visibility into valuations and investor demand, and can move ahead with confidence on pricing and timing.
CVC-backed Bamboo Insurance launched its roadshow this week seeking to raise as much as $700 million, while Hellman & Friedman-backed Hub International confidentially filed papers in June.
Founded in 2018 by Kenneth Gregg, Orion180 provides excess and surplus lines homeowners insurance across 14 US states. Its key markets include Texas, California and Florida.
"Both Orion180 and Bamboo cite lower-than-average loss ratios on policies, driven by their underwriting platforms; both are also growing quickly, which should appeal to investors," said Nicholas Einhorn, vice president, research, at Renaissance Capital, a provider of IPO-focused research and ETFs.
"But we've seen in the last few years that investors in insurance IPOs scrutinize the companies closely and those companies have sometimes had to prove themselves post-IPO."
Earlier this week, nuclear services company Holtec suspended its planned IPO, citing market conditions.
RBC Capital Markets, UBS Investment Bank and Raymond James are lead book-running managers. Orion180 will begin trading on the Nasdaq on Friday under the symbol "OIG".
(Reporting by Pragyan Kalita and Nethra Sailesh in Bengaluru; Additional reporting by Manya Saini; Editing by Subhranshu Sahu and Janane Venkatraman)
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