Bermudian insurer Ironshore has received a ratings boost from AM Best.

The ratings agency removed the insurer from being “under review with negative implications” and affirmed its A rating. However, the ratings were given a negative outlook.

Ironshore was put under review by AM Best in July last year, after the company was bought out by Chinese investment firm Fosun International in a deal worth $1.84 billion.

The ratings affirmation is a boost for the company ahead of its planned initial public offering, first announced in March. Last week Fosun said it had applied to the Hong Kong Stock Exchange for approval of its plan to spin off the insurer and give it a separate listing on either the Nasdaq or New York Stock Exchange.

AM Best said the IPO “is part of a strategy that could sufficiently insulate Ironshore from potential issues that Fosun may encounter”. The agency sees the spin-off as a strategy to insulate Ironshore from issues its parent may face due to its “vulnerable credit profile and aggressive acquisition activity”.

The IPO will “will enhance the previous actions Ironshore has already taken to strengthen its corporate governance structure”, AM Best added.

The ratings affirmation reflects AM Best’s view that “Ironshore has strong stand-alone attributes as a specialty insurer, will continue to build a relevant franchise in the specialty sector and is capable of delivering strong operating results”.

However, the negative outlook on Ironshore’s ratings is due to “the drag related to the credit profile and high debt leverage measures” of Fosun.