Company: MHLA
Filing Date: 2025-05-12
Form Type: 10-Q
Source: 0001412100-25-000043
Chunk: 271

Company: Maiden Holdings, Ltd.
Filing Date: 2025-05-12
Form: 10-Q
Item: Item 2
Chunk 271
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 during the second quarter of 2025.

See Note 1. Basis of Presentation in the Notes to Condensed Consolidated Financial Statements included in Part I Item 1. "Financial Information" for further information. We believe the upcoming combination with Kestrel represents a transformative milestone for Maiden, and believe that Kestrel’s balance sheet light, fee revenue model will enable us to realize our vision of delivering a strong fee-based insurance platform while selectively deploying underwriting capacity to optimize returns for shareholders. 

In light of the revisions to our strategy, during 2024 we took steps to begin to reduce the asset management pillar of our strategy which are discussed below. Our alternative investments portfolio increased by 1.1% during the three months ended March 31, 2025 primarily due to net purchases of private equity funds in the first quarter of 2025. However we expect this portfolio to be reduced further in future periods as we continue to refine our capital and asset management strategy consistent with our revised business strategy. The alternative portfolio produced a lower positive net return of 0.3% during the three months ended March 31, 2025 compared to 3.4% for the same respective period in 2024. While we remain confident that our asset management strategy will achieve the returns we have set out to achieve, we currently believe it is more critical to reposition our balance sheet and increase our liquidity in support of the current initiatives being pursued. 

While we have revised our strategy and believe that our upcoming combination with Kestrel will increase the likelihood of achieving our stated objectives, there can be no assurance that our insurance liabilities will run-off at levels that will permit further capital management activities, which we continually review as part of our strategy.  

As a result, we continue to pursue finality solutions to resolve the AmTrust liabilities not covered by the LPT/ADC Agreement, including through third-parties. There can be no guarantee that we will execute such finality solutions and these solutions could involve significant charges to execute and we are actively evaluating the potential costs and benefits of such solutions, to the extent they are available to the Company.  

2025 Developments 

The run-off of our historic reinsurance programs produced underwriting income of $7.5 million for the three months ended March 31, 2025 which was driven by favorable prior year reserve development of $12.4 million for three months ended March 31, 2025. During the three months ended March 31, 2025, our book