Maiden Holdings Announces Sale of U.S. Diversified Business to Enstar Holdings (US) LLC
August 31 2018 - 9:15AM
Maiden Holdings, Ltd. (NASDAQ: MHLD) (“Maiden” or the “Company”)
announced today that it has entered into an agreement to sell
Maiden Reinsurance North America, Inc. (“MRNA”), the Company’s U.S.
domestic insurance company, to Enstar Holdings (US) LLC (“Enstar”)
for net proceeds of $307.5 million and subject to certain closing
adjustments. Including the sale of MRNA, approximately $1.3 billion
of legacy reinsurance liabilities for Maiden’s U.S. Diversified
Business will be sold and novated to Enstar as part of the
transaction.
The transaction, which is expected to close in
the fourth quarter of 2018, does not include any of the Bermuda
underwriting elements of Maiden’s portfolio including its AmTrust
Business or its International Insurance Services and Capital
Solutions businesses in Europe, which forms the significant
majority of Maiden’s existing business and will remain as part of
its on-going business.
“Today’s announcement of the sale of MRNA
represents another step in our continuing strategic review.
This transaction will broaden our ability to manage and allocate
capital as we move forward, and will create value for our
shareholders,” said Lawrence F. Metz, Maiden’s President and Chief
Executive Officer designate.
Patrick J. Haveron, Maiden’s Chief Financial
Officer and Chief Operating Officer designate said: “Today’s
announcement along with our previously announced renewal rights
transaction will further enhance our capital position. We are
moving immediately to improve profitability by implementing
additional operational efficiencies and expense reductions through
the end of 2018, and we expect to provide further updates as we
move forward.”
About Maiden Holdings, Ltd.Maiden Holdings,
Ltd. is a Bermuda-based holding company formed in 2007. Through its
subsidiaries, which are each A- rated (excellent) by A.M. Best, the
Company is focused on providing non-catastrophic, customized
reinsurance products and services to small and mid-size insurance
companies in the United States and Europe. As of June 30, 2018,
Maiden had $6.7 billion in assets and shareholders' equity of $1.1
billion.
AdvisorsBofA Merrill Lynch is
acting as exclusive financial advisor and Paul, Weiss, Rifkind,
Wharton & Garrison LLP is acting as legal advisor to Maiden in
connection with the transaction.
Forward Looking StatementsThis
release contains "forward-looking statements" which are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. The forward-looking statements are
based on the Company's current expectations and beliefs concerning
future developments and their potential effects on the Company,
including forward-looking statements with respect to the potential
sale of MRNA, the benefits expected to be derived from the sale of
the renewal rights and the achievement of additional operational
efficiencies and expense reductions. Readers are cautioned that
actual results may differ materially from those projected as a
result of significant risks and uncertainties, including the
ability to negotiate a satisfactory agreement with respect to the
sale of MRNA, delay in achieving improvements (if any) in the
Company’s business results and financial positions, non-receipt of
expected payments, changes in interest rates, effect of the
performance of financial markets on investment income and fair
values of investments, developments of claims and the effect on
loss reserves, accuracy in projecting loss reserves, the impact of
competition and pricing environments, changes in the demand for the
Company's products, the effect of general economic conditions and
unusual frequency of storm activity, adverse state and federal
legislation, regulations and regulatory investigations into
industry practices, developments relating to existing agreements,
heightened competition, changes in pricing environments, and
changes in asset valuations. Additional information about these
risks and uncertainties, as well as others that may cause actual
results to differ materially from those projected is contained in
Item 1A. Risk Factors in the Company's Annual Report on Form 10-K
for the year ended December 31, 2017 as updated in periodic
filings with the SEC. However these factors should not be construed
as exhaustive. Forward-looking statements speak only as of the date
they are made and the Company undertakes no obligation to update or
revise any forward-looking statement that may be made from time to
time, whether as a result of new information, future developments
or otherwise, except as required by law.
CONTACT:Bill Horning, Senior Vice President,
Investor RelationsMaiden Holdings, Ltd.Phone: 856.359.2532E-mail:
bhorning@maiden.bm
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