/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES
OR FOR DISSEMINATION IN THE UNITED
STATES/
TORONTO, May 18, 2021 /CNW/ - Intact Financial
Corporation (TSX: IFC) ("Intact" or the "Company") announced today
that it (a) has completed its previously announced private
placements of Series 11 unsecured medium term notes (the "Series 11
Notes"), Series 12 unsecured medium term notes (the "Series 12
Notes") and Series 13 unsecured medium term notes (the "Series 13
Notes") (collectively, the "Notes") and (b) will redeem all of its
outstanding $300 million Series 4
unsecured medium term notes due August 18,
2021 (the "Series 4 Notes").
Closing of the Private Placement
The Notes were offered on a best efforts basis through a
syndicate co-led by CIBC World Markets Inc., TD Securities
Inc., and BMO Nesbitt Burns Inc. The Notes are direct unsecured
obligations of Intact and rank equally with all other unsecured and
unsubordinated indebtedness of Intact. The Series 11 Notes were
issued with a principal amount of $375
million and bear interest at a fixed annual rate of 1.207%
until maturity on May 21, 2024. The
Series 12 Notes were issued with a principal amount of $375 million and bear interest at a fixed annual
rate of 2.179% until maturity on May 18,
2028. The Series 13 Notes were issued with a principal
amount of $250 million and bear
interest at a fixed annual rate of 3.765% until maturity on
May 20, 2053. The Notes were 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 early redemption of the Series 4 Notes and 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. Any excess
net proceeds from the Private Placement will be used by Intact for
general corporate purposes.
This announcement does not constitute a notice of redemption.
Notice of redemption with respect to the Series 4 Notes will be
delivered today to CDS Clearing and Depository Services Inc.
("CDS"), the sole registered holder of the Series 4 Notes. If a
decision is made to redeem the RSA Senior Notes, formal notice will
be provided in accordance with the terms and conditions of the RSA
Senior Notes.
Following closing of the Acquisition, the redemption of the
Series 4 Notes and the anticipated redemption of the RSA Senior
Notes, the Company expects its debt-to-total-capital ratio to be
below 26% as at June 30, 2021.
The Series 11 Notes, the Series 12 Notes and the Series 13 Notes
have each been given a rating of A with a Stable trend by DBRS
Limited, a rating of Baa1 with a Stable outlook by Moody's
Investors Service, Inc. and a rating of A- with a Stable trend
by Fitch Ratings, Inc.
The closing of the Acquisition is expected to become effective
on June 1, 2021, subject to the
satisfaction or (where capable) waiver of the remaining conditions,
including the High Court of Justice in England and Wales sanctioning the schedule of arrangement
at the scheme court hearing scheduled to occur on May 25, 2021. Additional information on the
Acquisition is available at Intact's website at
https://www.intactfc.com/English/investors/.
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 Notes 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.
Redemption of Series 4 Notes
The Company also announced today that it will redeem, on
June 17, 2021, prior to maturity, all
of its outstanding Series 4 Notes. The redemption price for the
Series 4 Notes will be made available through a press release to be
issued by Intact on or about June 14,
2021 and will be determined in accordance with the trust
indenture governing the Series 4 Notes. The redemption amount paid
will include accrued and unpaid interest on the Series 4 Notes up
to, but excluding, the date of redemption.
Notice of redemption will be delivered today to CDS, the sole
registered holder of the Series 4 Notes. Non-registered holders who
maintain their interests in the Series 4 Notes through CDS should
contact their CDS customer service representative with any
questions about the redemption. Alternatively, beneficial holders
with any questions about the redemption should contact their
representative brokerage firm or financial institution, which holds
interests in the Series 4 Notes on their behalf.
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 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 expected use of the net proceeds of the Private
Placement, the Acquisition, including the closing thereof, the
redemption of the Series 4 Notes, including the timing thereof, the
anticipated redemption of the RSA Senior Notes 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 18, 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
expected use of the net proceeds of the Private Placement and
the receipt of the approval of the High Court of Justice in
England and Wales of the Acquisition. However, the
completion of the Acquisition is subject to customary closing
conditions, termination rights and other risks and uncertainties,
and there can be no assurance that 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