Reports that Melbourne-based international underwriting agency Sportscover is selling its Lloyd’s managing agency have been discounted by the company.

Director Steve Boucher says Sportscover’s Syndicate 3334 at Lloyd’s has had a £10 million ($18.7 million) shortfall in its £45.7 million ($85.8 million) capacity at Lloyd’s taken up by Haverford, a vehicle owned by Mark Byrne, the founder of Bermuda reinsurer Flagstone Re.

But he says a media report from London that Mr Byrne will also take over Sportscover’s managing agency is “getting ahead of things”.

Syndicate 3334 writes mostly sports and leisure business mainly on behalf of Sportscover Australia and its European offshoot. The capital shortfall occurred late last year when capital provider American Safety was placed in run-off and reinsurer Partner Re withdrew from supporting the syndicate.

“The syndicate has met all the growth targets set for it since it was formed in 2006, but we now want to achieve a quantum leap in distribution at Lloyd’s,” Mr Boucher told insuranceNEWS.com.au. “Lloyd’s provides us with great benefits but also has a high level of fixed costs.

“We’re looking at how we can most effectively achieve faster growth, which includes the option of partnering. But at this stage we’re only discussing how we could work together with Mr Byrne’s company.”

Mr Boucher says one possibility could see Mr Byrne taking equity in the managing agency, but “we’re not in that position yet”.