For Sale: Slightly Used Reinsurer, Contact S. Cohen

From the Wall Street Journal:
SAC Seeks Buyer for Reinsurer 

SAC Capital Advisors LP is seeking a buyer for a Bermuda-based reinsurance company that the embattled hedge-fund firm launched in 2012, according to people familiar with the matter.

SAC Re Ltd. began operations last year with $500 million in capital from SAC founder Steven A. Cohen, private-equity firm Capital Z Partners Management LLC and other investors, and it was seen as a potentially high-growth operation.

But shortly after SAC was indicted in July on criminal insider-trading charges, the firm and Capital Z began seeking potential buyers for the Bermuda business, the people said.

Several investors have been informally approached about buying SAC Re, including hedge fund Pine River Capital Management, according to people familiar with the talks. A spokesman for Pine River, based in Minnetonka, Minn., declined to comment. A sale is just one option being considered. Winding down the business also is a possibility, according to one person. ...MORE

HT: FT Alphaville

On top of the obvious reason to own a reinsurer, the use of the float as capital that investors won't withdraw, there is a sweet tax angle. From Bloomberg:

...Ordinarily, hedge fund investors pay either the 39.6 percent rate for ordinary income on their profits or the 20 percent long-term capital gains rate, depending on how frequently securities are traded, plus an extra 3.8 percent surcharge stemming from the Affordable Care Act. If they put money into a Bermuda-based reinsurer and have it invested in the hedge funds, any profits go to the reinsurer, which doesn’t owe tax on them. That allows the investors to defer taxes until they sell their stake in the reinsurer. Meanwhile, the money grows tax-free and the savings add up. Investing $100 million in a hedge fund that returns 10 percent annually for five years and paying the top marginal ordinary income rate on profits results in an after-tax gain of $50 million. If a Bermuda reinsurer holds the same investment, the gain is $77 million....MORE

In addition to Pine River, a relative* newbie, PE firm Searchlight Capital might take a run at the biz.
* Relative
Relative