Bowhead Specialty Holdings (BOW) upsized its IPO at pricing to 7.53 million shares – up from 6.67 million shares in the prospectus – and priced the IPO at $17.00 – $1.00 above the top of its $14.00-to-$16.00 range – to raise $128.0 million on Wednesday night, May 22, 2024. Bowhead’s stock surged 35.3 percent to open at $23.00 – up $6.00 from its IPO price – after 1 p.m. EDT today – Thursday, May 23, 2024 – in its debut on the New York Stock Exchange. Bowhead’s stock retraced a few steps to trade at around $22.82 at about 1:10 p.m. EDT on volume of 1.52 million shares. (Editor’s Note: This column, posted early Thursday, May 23, 2024, was updated at midday with Bowhead’s debut on the NYSE.)
At the closing bell, Bowden’s stock was at $23.80 – up $6.80 for a 40 percent gain from its $17.00 IPO price – on volume of about 3.25 million shares – in its first day of NYSE trading.
J.P. Morgan, Morgan Stanley and Keefe, Bruyette & Woods acted as the joint lead book-runners.
Citizens JMP, RBC Capital Markets and Dowling & Partners Securities, LLC acted as joint book-runners. Siebert Williams Shank served as co-manager.
Bowhead Specialty Holdings, based in New York, provides liability insurance for the construction, distribution, heavy manufacturing, real estate and hospitality business segments; professional liability insurance for financial institutions and nonprofits, and healthcare liability insurance for hospitals, senior care providers, managed care organizations and miscellaneous medical facilities. The company was founded in 2020 during the pandemic.
Bowhead says its ability to write business is “currently largely based on our relationship with AmFam,” American Family Mutual Insurance Company (AFMIC), according to the prospectus. “Through our relationship with AmFam, we are able to write business on an admitted basis in all 50 states and Washington, D.C., and on a non-admitted basis in all 50 states, Washington, D.C., and Puerto Rico.”
Most of Bowhead’s business is written on a non-admitted (Excess & Surplus) basis, the prospectus says.
AmFam “indirectly, owns approximately 29.0 percent of our company, as of March 31, 2024,” and it’s “also our strategic partner,” the prospectus says. AmFam is the nation’s 12th largest P&C group by premiums with policyholder surplus of approximately $7.0 billion as of Dec. 31, 2023, the prospectus says.
Bowhead is profitable. The specialty P&C insurer earned net income of $25.05 million on revenue of $283.4 million for the year that ended Dec. 31, 2023, according to financial statements in the prospectus.
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