Why SiriusPoint Rose 10% Today
Shares of reinsurance company (NYSE: TPRE) rose 10% Wednesday on news that hedge fund titan Dan Loeb's Third Point may take the company private.
Generally, when word circulates about a company potentially being acquired, that usually means the buyer is expected to pay a premium relative to its recent share prices. In addition, a decision to take a company private usually means the board and other owners think the stock price is undervaluing it. So, it's no surprise that SiriusPoint shares rose in response to the news.
SiriusPoint was created back in 2021 out of a merger between Third Point Reinsurance and Sirius International Insurance Group in order to create a more diversified operation and expand on the two companies' complementary offerings. (Yes, Third Point had already owned its own reinsurer, which it founded back in 2011.) Several hedge funds and private equity companies have acquired insurance operations over the past decade in order to generate steady streams of insurance float that they can then put to work in their investment strategies.
Source Fool.com
