Swiss Re has set a price range of 2.80 to 3.30 pounds for shares in the flotation of its UK life assurance business ReAssure, the world’s second-largest reinsurance company said on Thursday.

The price range implies a market capitalization of 2.8 billion or 3.55 billion dollars to 3.3 billion pounds or 4.19 billion dollars for the ReAssure flotation due to take place next month.

The offer is expected to deliver a free float of 26 per cent of ReAssure’s issued share capital.

Shares representing up to 15 per cent of the initial offer will be made available as an over-allotment option, which if exercised will take the free float up to nearly 30 per cent.

Swiss Re said the IPO prospectus is due to be published later on Thursday, pending approval from Britain’s Financial Conduct Authority.

Zurich-based Swiss Re is spinning off ReAssure to put the business under a more favorable regulatory regime and give it easier access to capital to fund its expansion.

ReAssure, Britain’s sixth-largest life insurer, has 68.7 billion pounds of assets under administration and focuses on so-called closed book policies that are shut to new customers.

Under the flotation plans, Swiss Re would cut its stake in ReAssure to below 50 per cent from 75 per cent now. Japan’s MS&AD Insurance Group Holdings intends to keep its holding at 25 per cent after the initial public offering. (Reuters/NAN)