RenaissanceRe's Joint Venture DaVinciRe Raises $300 Million in Senior Notes

RenaissanceRe Holdings Ltd. (NYSE: RNR), a global provider of reinsurance and insurance, recently announced that its joint venture, DaVinciRe Holdings Ltd., has priced a $300 million senior notes offering. The issuance of these notes, expected to close around March 5, 2025, will be used for general corporate purposes, including the repayment of DaVinciRe's existing $150 million 4.750% Senior Notes due 2025.



The notes, rated Baa1 by Moody's and A- by S&P, will have a coupon rate of 5.950% and a maturity date of 2035. They will be offered privately to qualified institutional buyers in the US under Rule 144A and to non-US persons under Regulation S. RenaissanceRe maintains a noncontrolling economic interest in DaVinciRe but controls the majority of voting shares, incorporating DaVinciRe's financials into RNR's consolidated statements.



This transaction is strategically significant for RenaissanceRe, as it allows DaVinciRe to expand its underwriting capacity without proportionate capital commitments or debt obligations. The issuance of these notes demonstrates proactive capital management and suggests management's confidence in deploying additional capital profitably in current market conditions.

The issuance of $300 million senior notes by DaVinciRe Holdings Ltd. impacts RenaissanceRe's capital structure and financial flexibility by:

1. Increasing DaVinciRe's net capital, enabling it to grow its business and underwrite more risks.
2. Diversifying DaVinciRe's funding sources, reducing its reliance on equity capital and providing a steady source of funding.
3. Improving DaVinciRe's financial ratings, reflecting its strong financial position and low risk profile.
4. Minimizing direct financial risk for RenaissanceRe, as its exposure to DaVinciRe is limited to its investment in DaVinciRe's shares and counterparty credit risk arising from reinsurance transactions.
5. Demonstrating proactive capital management and aligning with RenaissanceRe's strategy of matching well-structured risks with efficient capital.

In summary, the issuance of $300 million senior notes by DaVinciRe Holdings Ltd. enhances the company's capital structure, financial flexibility, and strategic alignment with RenaissanceRe's objectives. This issuance also reflects DaVinciRe's strong financial position and the hardening reinsurance market, where capacity remains constrained in certain segments.