Fitch upgrades Enact

Fitch Ratings said it upgraded Enact Holdings Inc. (ACT) issuer default rating to BBB- from BB and its senior debt rating to BB+ from BB-. The agency removed the ratings from rating watch positive.

The upgrades follow the partial IPO of the company's common stock for $19 per common share. About 13.3 million shares were offered to the public (8.2% ownership), and about 14.7 million shares were sold to Bayview Asset Management, LLC (9%) in a concurrent private sale.

The underwriters were granted an over-allotment option for up to an additional 2 million shares (1.2%). Following the offering, the ownership stake of Enact's parent, Genworth Financial, Inc. will be reduced to between 81.6% and 82.8% of the company's common stock, pending the underwriters' option.

“The registration documents also indicate Enact's plans to implement enhanced governance in the form of an independent chairperson and a committee of directors who will have veto rights over certain capital decisions. This capital committee will consist of all independent directors. The registration statement also states that it is anticipated that the board will consist of a majority of independent directors,” Fitch said in a press release.

The outlook is stable.

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