Expected to price tonight is a $300M IPO for Third Point Reinsurance (TPRE) which will allow investors to bet alongside Daniel Loeb, but also take on the risk of whether the underwriting operation can be a profitable one.
Similar to David Einhorn's Greenlight Re (GLRE), TPRE provides Loeb with "permanent capital" in the form of a low cost float from the insurance business.
The stock will be valued at 1.1x book value if it prices at the midpoint of the expected $12.50 to $14.50 range, not too dissimilar from GLRE.
The insurance operation is just getting started so there's little to chew on there, but Loeb's history (he's compounded money at 17.7% annually over the last decade) and the reasonable valuation are enough to interest The Brooklyn Investor. Yes, the insurance business is a worry, but Third Point (like Greenlight) is in the business of managing risk and presumably has the resources to bring on the necessary insurance expertise.
TPRE roadshow presentation.