Fairfax Completes C$850 Million Senior Notes Offering
March 01 2021 - 8:19AM
Fairfax Financial Holdings Limited (“Fairfax”) (TSX: FFH and FFH.U)
has completed its previously announced offering of C$850 million in
aggregate principal amount of 3.95% Senior Notes due 2031 (the
“Offering”).
The Senior Notes were offered through a
syndicate of underwriters led by Scotiabank, BMO Capital Markets,
and RBC Capital Markets, as joint bookrunners. The Senior Notes are
unsecured obligations of Fairfax and pay a fixed rate of interest
of 3.95% per annum.
Fairfax will use the net proceeds of the
Offering to redeem in full on March 28, 2021 (i) the C$446 million
outstanding principal amount of Fairfax’s 5.84% senior notes due
October 14, 2022 plus accrued and unpaid interest and (ii) the
C$400 million outstanding principal amount of Fairfax’s 4.50%
senior notes due March 22, 2023 plus accrued and unpaid interest,
as previously announced.
This press release shall not constitute an offer
to sell or the solicitation of an offer to buy nor shall there be
any sale of the securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
This press release is not an offer of securities for sale in the
United States, and the securities may not be offered or sold in the
United States absent registration or an exemption from the
registration requirements. The securities have not been and will
not be registered under the United States Securities Act of 1933,
as amended.
Fairfax is a holding company which, through its
subsidiaries, is engaged in property and casualty insurance and
reinsurance and the associated investment management.
For further information, contact: |
John Varnell, Vice President, Corporate Development |
|
(416) 367-4941 |
Certain statements contained herein may
constitute forward-looking statements and are made pursuant to the
“safe harbour” provisions of applicable Canadian securities laws.
The forward-looking information in this release includes, without
limitation, the Company’s intended use of the net proceeds of the
Offering. Such forward-looking statements are subject to known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of Fairfax to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking
statements. Such factors include, but are not limited to: a
reduction in net earnings if our loss reserves are insufficient;
underwriting losses on the risks we insure that are higher or lower
than expected; the occurrence of catastrophic events with a
frequency or severity exceeding our estimates; changes in market
variables, including interest rates, foreign exchange rates, equity
prices and credit spreads, which could negatively affect our
investment portfolio; risks associated with the global pandemic
caused by COVID-19, and the related global reduction in commerce
and substantial downturns in stock markets worldwide; the cycles of
the insurance market and general economic conditions, which can
substantially influence our and our competitors’ premium rates and
capacity to write new business; insufficient reserves for asbestos,
environmental and other latent claims; exposure to credit risk in
the event our reinsurers fail to make payments to us under our
reinsurance arrangements; exposure to credit risk in the event our
insureds, insurance producers or reinsurance intermediaries fail to
remit premiums that are owed to us or failure by our insureds to
reimburse us for deductibles that are paid by us on their behalf;
our inability to maintain our long term debt ratings, the inability
of our subsidiaries to maintain financial or claims paying ability
ratings and the impact of a downgrade of such ratings on derivative
transactions that we or our subsidiaries have entered into; risks
associated with implementing our business strategies; the timing of
claims payments being sooner or the receipt of reinsurance
recoverables being later than anticipated by us; risks associated
with any use we may make of derivative instruments; the failure of
any hedging methods we may employ to achieve their desired risk
management objective; a decrease in the level of demand for
insurance or reinsurance products, or increased competition in the
insurance industry; the impact of emerging claim and coverage
issues or the failure of any of the loss limitation methods we
employ; our inability to access cash of our subsidiaries; our
inability to obtain required levels of capital on favourable terms,
if at all; the loss of key employees; our inability to obtain
reinsurance coverage in sufficient amounts, at reasonable prices or
on terms that adequately protect us; the passage of legislation
subjecting our businesses to additional adverse requirements,
supervision or regulation, including additional tax regulation, in
the United States, Canada or other jurisdictions in which we
operate; risks associated with government investigations of, and
litigation and negative publicity related to, insurance industry
practice or any other conduct; risks associated with political and
other developments in foreign jurisdictions in which we operate;
risks associated with legal or regulatory proceedings or
significant litigation; failures or security breaches of our
computer and data processing systems; the influence exercisable by
our significant shareholder; adverse fluctuations in foreign
currency exchange rates; our dependence on independent brokers over
whom we exercise little control; impairment of the carrying value
of our goodwill, indefinite-lived intangible assets or investments
in associates; our failure to realize deferred income tax assets;
technological or other change which adversely impacts demand, or
the premiums payable, for the insurance coverages we offer;
disruptions of our information technology systems; assessments and
shared market mechanisms which may adversely affect our insurance
subsidiaries; and adverse consequences to our business, our
investments and our personnel resulting from or related to the
COVID-19 pandemic. Additional risks and uncertainties are described
in our most recently issued Annual Report which is available at
www.fairfax.ca and in our Base Shelf Prospectus (under “Risk
Factors”) filed with the securities regulatory authorities in
Canada, which is available on SEDAR at www.sedar.com. Fairfax
disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by applicable
securities law.
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