/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES
OR FOR DISSEMINATION IN THE UNITED
STATES/
TORONTO, May 13, 2021 /CNW/ - Intact Financial Corporation
(TSX: IFC) ("Intact" or the "Company") announced today that it
intends to issue a minimum of $350
million aggregate principal amount of Series 11 unsecured
medium term notes (the "Series 11 Notes"), a minimum of
$350 million aggregate principal
amount of Series 12 unsecured medium term notes (the "Series 12
Notes"), and a minimum of $200
million aggregate principal amount of Series 13 unsecured
medium term notes (the "Series 13 Notes") (collectively, the
"Notes"), subject to market conditions. The Notes will be direct
unsecured obligations of Intact and will rank equally with all
other unsecured and unsubordinated indebtedness of Intact.
The Series 11 Notes are expected to mature on May 21, 2024, the Series 12 Notes are expected to
mature on May 18, 2028, and the
Series 13 Notes are expected to mature on May 20, 2053. The Notes are being offered by way
of private placement to accredited investors in Canada (the "Private Placement"). Intact
intends to use the net proceeds from the Private Placement to fund
the intended early redemption of the £350 million Senior 1.625 per
cent notes due August 28, 2024 (the
"RSA Senior Notes") issued by RSA Insurance Group plc ("RSA") after
closing of Intact's previously announced proposed acquisition of
the entire issued and to be issued share capital of RSA (the
"Acquisition"), a transaction to be carried out by the Company
together with Tryg A/S, and to fund the intended early redemption
of Intact's $300 million Series 4
unsecured medium term notes due August 18,
2021 (the "Series 4 Notes"). A portion of the net proceeds
may instead be used by Intact to fund a portion of the purchase
price for the Acquisition in the event that certain regulatory
approvals related to a portion of the previously announced equity
investment in the Company by Caisse de dépôt et placement du Québec
are not received prior to the closing of the Acquisition. If the
net proceeds of the Private Placement are (i) insufficient to fully
fund such redemptions, the Company currently intends to use
available cash resources or undertake further financings to satisfy
such shortfall or (ii) greater than the amount required by Intact
as noted above, any such excess net proceeds will be used by it for
general corporate purposes.
Following closing of the Acquisition and the anticipated
redemption of the RSA Senior Notes and the Series 4 Notes, the
Company expects its debt-to-total-capital ratio to be below 26% as
at June 30, 2021.
This announcement does not constitute a notice of redemption. If
a decision is made to redeem the RSA Senior Notes and/or the Series
4 Notes, formal notice will be provided in accordance with the
terms and conditions of the relevant securities.
The Notes, offered on a best efforts basis through a syndicate
co-led by CIBC World Markets Inc., TD Securities Inc., and BMO
Nesbitt Burns Inc., are expected to be issued on or about
May 18, 2021. The closing of the Private Placement will be
subject to certain customary conditions, including, but not limited
to, the execution of an agency agreement with the syndicate.
If (i) closing of the Acquisition has not occurred prior to
11:59 p.m. (London UK local time) on December 31, 2021, or (ii) in certain
circumstances where: (a) the scheme of arrangement for the
Acquisition lapses or is withdrawn, or (b) if the Acquisition is
implemented by way of a takeover offer, such takeover offer lapses,
terminates or is withdrawn, then Intact will be required to redeem
the Notes at a redemption price equal to 100% of the aggregate
principal amount of the Notes, plus accrued and unpaid interest, if
any, up to, but excluding, the date of redemption.
The closing of the Acquisition is expected to become effective
on June 1, 2021, subject to the
satisfaction or (where capable of waiver) waiver of the remaining
conditions, including the High Court of Justice in England and Wales sanctioning the scheme of arrangement at
the scheme court hearing, on May 25,
2021. Additional information on the Acquisition is available
at Intact's website at
https://www.intactfc.com/English/investors/.
The securities to be offered have not been and will not be
registered under the U.S. Securities Act of 1933, as amended ("U.S.
Securities Act"), and may not be offered or sold in the United States or to or for the account or
benefit of U.S. persons absent registration or an applicable
exemption from the registration requirements of the U.S. Securities
Act. This press release shall not constitute an offer to sell or
the solicitation of an offer to buy such securities in the United States or in any other jurisdiction
where such offer is unlawful.
About Intact Financial Corporation
Intact Financial Corporation is the largest provider of property
and casualty (P&C) insurance in Canada and a leading provider of specialty
insurance in North America, with
over $12 billion in total annual
premiums. The Company has over 16,000 employees who serve more than
five million personal, business and public sector clients through
offices in Canada and the U.S.
In Canada, Intact distributes
insurance under the Intact Insurance brand through a wide network
of brokers, including its wholly-owned subsidiary BrokerLink, and
directly to consumers through belairdirect. Intact Public Entities,
a leading Canadian Managing General Agent (MGA), distributes public
entity insurance programs including risk and claims management
services in Canada.
In the U.S., Intact Insurance Specialty Solutions provides a
range of specialty insurance products and services through
independent agencies, regional and national brokers, wholesalers
and managing general agencies. Products are underwritten by the
insurance company subsidiaries of Intact Insurance Group
USA, LLC.
Cautionary note regarding forward-looking statements and
Non-IFRS Measures
Certain of the statements included in this press release about
the Private Placement, including the minimum aggregate principal
amounts of the Notes, the closing of the Private Placement, the
expected maturity dates of the Notes and the expected use of the
net proceeds of the Private Placement, and the Acquisition,
including the closing thereof, or any other future events or
developments, including the Company's expectations regarding its
debt-to-total-capital ratio, constitute forward-looking statements.
The words "may", "will", "would", "should", "could", "expects",
"plans", "intends", "trends", "indications", "anticipates",
"believes", "estimates", "predicts", "likely", "potential" or the
negative or other variations of these words or other similar or
comparable words or phrases, are intended to identify
forward-looking statements. Unless otherwise indicated, all
forward-looking statements in this press release are made as of
May 13, 2021 and are subject to
change after that date.
Forward-looking statements are based on estimates and
assumptions made by management based on management's experience and
perception of historical trends, current conditions and expected
future developments, as well as other factors that management
believes are appropriate in the circumstances. In addition to other
estimates and assumptions which may be identified herein, estimates
and assumptions have been made regarding, among other things, the
anticipated closing of the Private Placement, the expected use of
the net proceeds thereof and the receipt of the approval of the
High Court of Justice in England
and Wales of the Acquisition.
However, the completion of the Private Placement and the
Acquisition is each subject to customary closing conditions,
termination rights and other risks and uncertainties, and there can
be no assurance that the Private Placement and the Acquisition will
be completed within anticipated timeframes or at all.
Certain of the forward-looking statements included in this press
release may be considered "financial outlook" for purposes of
applicable Canadian provincial and territorial securities laws. The
purpose of including information relating to the expected future
debt-to-total-capital ratio in this press release is to provide the
reader with an indication of management's objectives and
expectations, as of the date of this press release, regarding the
Company's future performance. Readers are cautioned that this
information may not be appropriate for other purposes.
All of the forward-looking statements included in this press
release are qualified by these cautionary statements and those made
in the section entitled Risk Management (Sections 28-33) of our
MD&A for the year ended December 31,
2020, the section entitled Risk Management (Section 19) of
our MD&A for the quarter ended March 31,
2021, and the section entitled Risk Factors -
Risks Related to the Acquisition of our presentation entitled
"Building a Leading P&C Insurer" dated November 18, 2020 and available on our website.
These factors are not intended to represent a complete list of the
factors that could affect the Company. These factors should,
however, be considered carefully. Although the forward-looking
statements are based upon what management believes to be reasonable
assumptions, the Company cannot assure investors that actual
results will be consistent with these forward-looking statements.
Investors should not rely on forward-looking statements to make
decisions, and investors should ensure the preceding information is
carefully considered when reviewing forward-looking statements
contained herein. The Company and management have no intention and
undertake no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by law.
The Company uses both International Financial Reporting
Standards (IFRS) and certain non-IFRS measures to assess
performance. Non-IFRS measures, including debt-to-capital ratio, do
not have any standardized meaning prescribed by IFRS and are
unlikely to be comparable to any similar measures presented by
other companies. The Company calculates debt-to-capital ratio by
dividing total debt outstanding by the sum of total shareholders'
equity and total debt outstanding, at the same date. Hybrid debt is
excluded from debt outstanding and is instead included in the total
financial leverage with preferred shares. Refer to Section 21 –
Non-IFRS financial measures in the Company's management's
discussion and analysis for the three months ended March 31, 2021 for further details.
Disclaimer
This press release does not constitute or form part of any offer
for sale or solicitation of any offer to buy or subscribe for
any securities nor shall it or any part of it form the basis of or
be relied on in connection with, or act as any inducement to enter
into, any contract or commitment whatsoever.
The information contained in this press release concerning the
Company does not purport to be all-inclusive or to contain all the
information that an investor may desire to have in evaluating
whether or not to make an investment in the Company. The
information is qualified entirely by reference to the Company's
publicly disclosed information and the cautionary note regarding
forward-looking statements included in this press release.
No representation or warranty, express or implied, is made or
given by or on behalf of the Company or any of its the directors,
officers or employees as to the accuracy, completeness or fairness
of the information or opinions contained in this press release and
no responsibility or liability is accepted by any person for such
information or opinions. In furnishing this press release, the
Company does not undertake or agree to any obligation to provide
investors with access to any additional information or to update
this press release or to correct any inaccuracies in, or omissions
from, this press release that may become apparent. The information
and opinions contained in this press release are provided as at the
date of this press release. The contents of this press release are
not to be construed as legal, financial or tax advice. Each
investor should contact his, her or its own legal adviser,
independent financial adviser or tax adviser for legal, financial
or tax advice.
SOURCE Intact Financial Corporation