Swiss Re has suspended the $4.5bn initial public offering (IPO) of its UK subsidiary ReAssure Group citing weak investor demand.

The decision to postpone the IPO, according to the company, is in response to the “heightened caution and weaker underlying demand” from large institutional investors.

Swiss Re group CFO John Dacey said: “While we firmly believe that the long-term interests of ReAssure are best served by a more diversified shareholder base, there has been no pressing need for Swiss Re to divest shares at a price that we consider to be unrepresentative of ReAssure’s value and future prospects.

“We retain our objective to reduce Swiss Re’s ownership in order to de-consolidate ReAssure. In the meantime, Swiss Re and MS&AD remain fully committed and supportive of ReAssure and its management team, and will participate in future acquisitions in line with their respective shareholdings.”

ReAssure, which is one of the sixth largest life insurers in the UK, planned to list at least 25% stake that will effectively reduce Swiss Re’s stake to 50%.

The idea to float the UK business was first announced in August last year.

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In preparation of the planned IPO, Swiss Re reorganised ReAssure into a standalone entity. Swiss Re and MS&AD Group had said they will infuse £481m ($611m) in capital into ReAssure ahead of the IPO.

Credit Suisse, Morgan Stanley and UBS were appointed to serve as joint global coordinators, while BNP Paribas and HSBC were chosen to act as joint bookrunners for the IPO.