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Noncontrolling Interests

3 Months Ended

Mar. 31, 2021

Business Combination, Acquisition of Less than 100 Percent, Noncontrolling Interest [Abstract]

Noncontrolling Interests

NONCONTROLLING INTERESTS

A summary of the Company’s redeemable noncontrolling interests on its consolidated balance sheets is set forth below:

						March 31, 2021						December 31, 2020
			Redeemable noncontrolling interest - DaVinciRe			$	1,555,714					$	1,560,693
			Redeemable noncontrolling interest - Medici			737,702						717,999
			Redeemable noncontrolling interest - Vermeer			1,116,154						1,109,627
			Redeemable noncontrolling interests			$	3,409,570					$	3,388,319

A summary of the Company’s redeemable noncontrolling interests on its consolidated statements of operations is set forth below:

												Three months ended
																		March 31, 2021						March 31, 2020
			Redeemable noncontrolling interest - DaVinciRe															$	(39,934)					$	84,906
			Redeemable noncontrolling interest - Medici															(13,443)						(4,678)
			Redeemable noncontrolling interest - Vermeer															6,527						17,863
			Net (loss) income attributable to redeemable noncontrolling interests															$	(46,850)					$	98,091

Redeemable Noncontrolling Interest – DaVinciRe

RenaissanceRe owns a noncontrolling economic interest in DaVinciRe; however, because RenaissanceRe controls a majority of DaVinciRe’s outstanding voting rights, the consolidated financial statements of DaVinciRe are included in the consolidated financial statements of the Company and all significant intercompany transactions have been eliminated. The portion of DaVinciRe’s earnings owned by third parties is recorded in the consolidated statements of operations as net income attributable to redeemable noncontrolling interests. The Company’s noncontrolling economic ownership in DaVinciRe was 28.7% at March 31, 2021 (December 31, 2020 - 21.4%).

DaVinciRe shareholders are party to a shareholders agreement which provides DaVinciRe shareholders, excluding RenaissanceRe, with certain redemption rights that enable each shareholder to notify DaVinciRe of such shareholder’s desire for DaVinciRe to repurchase up to half of such shareholder’s initial aggregate number of shares held, subject to certain limitations, such as limiting the aggregate of all share repurchase requests to 25% of DaVinciRe’s capital in any given year and satisfying all applicable regulatory requirements. If total shareholder requests exceed 25% of DaVinciRe’s capital, the number of shares repurchased will be reduced among the requesting shareholders pro-rata, based on the amounts desired to be repurchased. Shareholders desiring to have DaVinci repurchase their shares must notify DaVinciRe before March 1 of each year. The repurchase price will be based on GAAP book value as of the end of the year in which the shareholder notice is given, and the repurchase will be effective as of January 1 of the following year. The repurchase price is generally subject to a true-up for potential development on outstanding loss reserves after settlement of all claims relating to the applicable years.

2021

During the three months ended March 31, 2021, DaVinciRe completed an equity capital raise of $250.0 million, comprised of $150.9 million from third-party investors and $99.1 million from RenaissanceRe. In addition, RenaissanceRe sold an aggregate of $40.0 million of its shares in DaVinciRe to third-party investors and purchased an aggregate of $156.7 million of shares from third-party investors. The Company’s noncontrolling economic ownership in DaVinciRe subsequent to these transactions was 28.7%.

2020

Effective January 1, 2020, the Company sold an aggregate of $10.0 million of its shares in DaVinciRe to an existing third-party investor. The Company’s noncontrolling economic ownership in DaVinciRe subsequent to this transaction was 21.4%.

The Company expects its noncontrolling economic ownership in DaVinciRe to fluctuate over time.

The activity in redeemable noncontrolling interest – DaVinciRe is detailed in the table below:

												Three months ended
																		March 31, 2021						March 31, 2020
			Beginning balance															$	1,560,693					$	1,435,581
			Redemption of shares from redeemable noncontrolling interest, net of adjustments															(155,971)						2,607
			Sale of shares to redeemable noncontrolling interests															190,926						9,991
			Net (loss) income attributable to redeemable noncontrolling interest															(39,934)						84,906
			Ending balance															$	1,555,714					$	1,533,085

Redeemable Noncontrolling Interest - Medici

RenaissanceRe owns a noncontrolling economic interest in Medici; however, because RenaissanceRe controls all of Medici’s outstanding voting rights, the financial statements of Medici are included in the consolidated financial statements of the Company. The portion of Medici’s earnings owned by third parties is recorded in the consolidated statements of operations as net income attributable to redeemable noncontrolling interests. Any shareholder may redeem all or any portion of its shares as of the last day of any calendar month, upon at least 30 calendar days’ prior irrevocable written notice to Medici.

2021

During the three months ended March 31, 2021, third-party investors subscribed for $40.8 million and redeemed $7.7 million of the participating, non-voting common shares of Medici. As a result of these net subscriptions, the Company’s noncontrolling economic ownership in Medici was 15.4% at March 31, 2021.

2020

During the three months ended March 31, 2020, third-party investors subscribed for $54.6 million and redeemed $4.8 million of the participating, non-voting common shares of Medici. As a result of these net subscriptions, the Company’s noncontrolling economic ownership in Medici was 11.2% at March 31, 2020.

The Company expects its noncontrolling economic ownership in Medici to fluctuate over time.

The activity in redeemable noncontrolling interest – Medici is detailed in the table below:

												Three months ended
																		March 31, 2021						March 31, 2020
			Beginning balance															$	717,999					$	632,112
			Redemption of shares from redeemable noncontrolling interest, net of adjustments															(7,699)						(4,764)
			Sale of shares to redeemable noncontrolling interests															40,845						54,613
			Net loss attributable to redeemable noncontrolling interest															(13,443)						(4,678)
			Ending balance															$	737,702					$	677,283

Redeemable Noncontrolling Interest – Vermeer

RenaissanceRe owns 100% of the voting non-participating shares of Vermeer, while the sole third-party investor, PFZW, owns 100% of the non-voting participating shares of Vermeer and retains all of the economic benefits. Vermeer is managed by RUM in return for a management fee. The Company has concluded that Vermeer is a VIE as it has voting rights that are not proportional to its participating rights, and the Company is the primary beneficiary of Vermeer. As a result, the Company consolidates Vermeer and all significant inter-company transactions have been eliminated. As PFZW owns all of the economics of Vermeer, all of Vermeer’s earnings are allocated to PFZW in the consolidated statement of operations as net income attributable to redeemable noncontrolling interests. The Company has not provided any financial or other support to Vermeer that it was not contractually required to provide.

The activity in redeemable noncontrolling interest – Vermeer is detailed in the table below:

												Three months ended
																		March 31, 2021						March 31, 2020
			Beginning balance															$	1,109,627					$	1,003,615
			Net income attributable to redeemable noncontrolling interest															6,527						17,863
			Ending balance															$	1,116,154					$	1,021,478

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- References

No definition available.

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- Definition

The entire disclosure for noncontrolling interest in consolidated subsidiaries, which could include the name of the subsidiary, the ownership percentage held by the parent, the ownership percentage held by the noncontrolling owners, the amount of the noncontrolling interest, the location of this amount on the balance sheet (when not reported separately), an explanation of the increase or decrease in the amount of the noncontrolling interest, the noncontrolling interest share of the net Income or Loss of the subsidiary, the location of this amount on the income statement (when not reported separately), the nature of the noncontrolling interest such as background information and terms, the amount of the noncontrolling interest represented by preferred stock, a description of the preferred stock, and the dividend requirements of the preferred stock.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 810
-URI http://asc.fasb.org/topic&trid=2197479

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