CEO and Chief Risk Officer of VR [Validus Holdings] Sell Shares

[einai]

I have closed out a 1/3 of my HOV puts, and put the money towards Aug puts in VR, a marine liability reinsurer whose CEO and Chief Risk Officer are selling stock.

Unlike HOV, which was a no-brainer (and which I am still short, after a 50% drop), this one requires your thinking cap. No guarantees.

http://www.sec.gov/Archives/edgar/data/1348259/000120919110036171/xslF345X03/doc4.xml

http://www.sec.gov/cgi-bin/own-disp?action=getowner&CIK=0001407205

 

[einai]

More selling, different insiders.

http://www.sec.gov/Archives/edgar/data/1348259/000120919110037238/xslF345X03/doc4.xml

Bought more puts for after earnings.

Short-tail marine reinsurance means damage claims.

NB I have no inside knowledge. But I think that when insiders are selling marine reinsurance in this environment, that is probably significant.

 

[einai]

This obscure mention in a Croation newspaper last night seems to show what is going on. I suggest that you look at the initial prospectus and their strategy of loss reserves and "arbitrage" of opportunities in the Gulf.

This company wrote a lot of short-tail Gulf-related marine and energy insurance at what they thought are good rates. Their offices are sellling, they are restructuring. I am upgrading my recommendation to sell.

"Validus reaches an agreement with Croatia LLoyd on debt reprogram

Holding Validus signed an agreement with insurance company Croatia LLoyd on reschedule of matured debt and cessation of enforced HRK 45mn debt collection. This contract is part of financial restructuring of Validus and the fist phase in process of agreement with other creditors. Validus expects agreement with other creditors to be realized within two months."

http://www.seenews.com/news/latestnews/erstesecurities-croatianequitydaily-july28_2010-090939/

 

[einai]

Prospectus here. They seem also to have had large positions in MBS's.


http://www.sec.gov/Archives/edgar/data/1348259/000095012307010347/y37506b4e424b4.htm#110

 

[einai]

Quote from einai:

"Validus reaches an agreement with Croatia LLoyd on debt reprogram"

http://www.seenews.com/news/latestnews/erstesecurities-croatianequitydaily-july28_2010-090939/ [/B]

Seems to be a distinct organisation. Still working on what's driving the selling. Analysis of fundamentals and insider selling remains.