Kinsale moved in 2014 to 2221 Edward Holland Drive. File photo – December 2013 – by Michael Schwartz.
A local insurance company’s debut on the stock market this week surpassed its target capital raise while opening the door for its principal investor to cash in on its investment.
Henrico-based Kinsale Insurance, through its holding company Kinsale Capital Group, raised $106 million in an IPO late Wednesday of 6.6 million shares of common stock at a price of $16 per share.
The company began trading on the NASDAQ exchange Thursday under the symbol “KNSL.” Shares closed Thursday at $18.35 per share after peaking as high as $18.79 per share.
Mike Kehoe, founder and CEO of Kinsale, called the IPO “a very successful public offering,” attributing the reception to the company’s record of positive returns on investment.
“We’re a small company, but it’s a very high-performing, disciplined underwriting company that’s produced really some best-in-class returns for its investors over the last several years, so that naturally attracted the interest of a lot of investors,” Kehoe said.
“We’re excited to be a public company and to continue to work hard for investors and deliver world-class returns, and grow the value of the business over the long-haul.”
The offering comes seven years after Kehoe founded the company, which specializes in property, casualty and specialty insurance policies for a variety of businesses.
In that time, the company has experienced significant growth, from $125 million in revenue from gross written premiums in 2013 to $177 million by the end of the last year. Net profit grew from $12.2 million in 2013 to $29.2 million in 2015.
That growth has landed Kinsale on Richmond BizSense’s RVA 25 rankings of Richmond’s fastest growing companies each of the last three years.
Kehoe said the timing of the IPO was twofold: to raise the $106 million in capital to finance the company’s growth, and to provide a pathway to liquidity for its principal investor and controlling stockholder Moelis Capital Partners, which first invested in Kinsale in 2009.
The offering consisted of 5 million shares that were offered by the company and 1.6 million offered by Moelis and other selling stockholders. Like other private equity funds, Kehoe noted that Moelis, having been an investor for several years, is looking to sell its shares and liquidate the fund to return the proceeds of the investment to its clients.
“Our financial sponsor will use our public status to gradually sell down its position in the stock over the next several years,” he said. “They sold down some shares in the offer, and we’d expect them to liquidate their position completely over the next several years.”
Underwriters of the offering include J.P. Morgan Securities, William Blair & Company, RBC Capital Markets and Moelis & Company, an affiliate of Moelis Capital Partners. They have a 30-day option to purchase as much as 990,000 additional shares from the selling stockholders. Kinsale will not receive proceeds from those sales.
Kehoe compared the IPO to that of locally-based James River Insurance Company, a fellow specialty insurer whose holding company, James River Group Holdings, went public in late 2014 with an IPO that raised $231 million. In that offering, investors D.E. Shaw & Co. and Goldman Sachs sold 11 million shares at $21 per share, after offering them for $22 to $24, according to a report that noted the company didn’t sell any shares and didn’t receive any proceeds as a result.
Kinsale filed its preliminary IPO registration documents July 1. As of that date, the company had 144 employees and occupied 34,000 square feet of offices in the Anthem building at 2221 Edward Holland Drive, where it pays an annual rent of about $600,000.
Kinsale moved to the building in 2013, and its lease there will expire in 2020. The company does not own any real estate. The company began writing business policies in March 2010 and is eligible to do so in all 50 states and Washington, D.C.
Kinsale’s offering follows suit with other Richmond-based companies that have recently gone public. Last year, Performance Food Group sought a $400 million raise in its return to the New York Stock Exchange. Apple Hospitality REIT joined the Big Board the same year, while Allegiancy, a 3-year-old real estate firm, recently took its $30 million IPO back to the drawing board.
Kinsale moved in 2014 to 2221 Edward Holland Drive. File photo – December 2013 – by Michael Schwartz.
A local insurance company’s debut on the stock market this week surpassed its target capital raise while opening the door for its principal investor to cash in on its investment.
Henrico-based Kinsale Insurance, through its holding company Kinsale Capital Group, raised $106 million in an IPO late Wednesday of 6.6 million shares of common stock at a price of $16 per share.
The company began trading on the NASDAQ exchange Thursday under the symbol “KNSL.” Shares closed Thursday at $18.35 per share after peaking as high as $18.79 per share.
Mike Kehoe, founder and CEO of Kinsale, called the IPO “a very successful public offering,” attributing the reception to the company’s record of positive returns on investment.
“We’re a small company, but it’s a very high-performing, disciplined underwriting company that’s produced really some best-in-class returns for its investors over the last several years, so that naturally attracted the interest of a lot of investors,” Kehoe said.
“We’re excited to be a public company and to continue to work hard for investors and deliver world-class returns, and grow the value of the business over the long-haul.”
The offering comes seven years after Kehoe founded the company, which specializes in property, casualty and specialty insurance policies for a variety of businesses.
In that time, the company has experienced significant growth, from $125 million in revenue from gross written premiums in 2013 to $177 million by the end of the last year. Net profit grew from $12.2 million in 2013 to $29.2 million in 2015.
That growth has landed Kinsale on Richmond BizSense’s RVA 25 rankings of Richmond’s fastest growing companies each of the last three years.
Kehoe said the timing of the IPO was twofold: to raise the $106 million in capital to finance the company’s growth, and to provide a pathway to liquidity for its principal investor and controlling stockholder Moelis Capital Partners, which first invested in Kinsale in 2009.
The offering consisted of 5 million shares that were offered by the company and 1.6 million offered by Moelis and other selling stockholders. Like other private equity funds, Kehoe noted that Moelis, having been an investor for several years, is looking to sell its shares and liquidate the fund to return the proceeds of the investment to its clients.
“Our financial sponsor will use our public status to gradually sell down its position in the stock over the next several years,” he said. “They sold down some shares in the offer, and we’d expect them to liquidate their position completely over the next several years.”
Underwriters of the offering include J.P. Morgan Securities, William Blair & Company, RBC Capital Markets and Moelis & Company, an affiliate of Moelis Capital Partners. They have a 30-day option to purchase as much as 990,000 additional shares from the selling stockholders. Kinsale will not receive proceeds from those sales.
Kehoe compared the IPO to that of locally-based James River Insurance Company, a fellow specialty insurer whose holding company, James River Group Holdings, went public in late 2014 with an IPO that raised $231 million. In that offering, investors D.E. Shaw & Co. and Goldman Sachs sold 11 million shares at $21 per share, after offering them for $22 to $24, according to a report that noted the company didn’t sell any shares and didn’t receive any proceeds as a result.
Kinsale filed its preliminary IPO registration documents July 1. As of that date, the company had 144 employees and occupied 34,000 square feet of offices in the Anthem building at 2221 Edward Holland Drive, where it pays an annual rent of about $600,000.
Kinsale moved to the building in 2013, and its lease there will expire in 2020. The company does not own any real estate. The company began writing business policies in March 2010 and is eligible to do so in all 50 states and Washington, D.C.
Kinsale’s offering follows suit with other Richmond-based companies that have recently gone public. Last year, Performance Food Group sought a $400 million raise in its return to the New York Stock Exchange. Apple Hospitality REIT joined the Big Board the same year, while Allegiancy, a 3-year-old real estate firm, recently took its $30 million IPO back to the drawing board.