Till Capital Ltd. (TSX.V: TIL) (the “Company” or
“Till), a Bermuda domiciled reinsurance provider announces
that it has entered into a letter of intent with Omega Insurance
Holdings, Inc. (“Omega”), a Toronto, Canada based insurance
provider, and its shareholders, pursuant to which the Company
proposes to acquire all of the issued and outstanding shares of
Omega (the “Proposed Transaction”). The letter of intent
with Omega includes the subsidiary companies Omega General
Insurance Company and Focus Group, Inc.
“We are enthusiastic about this accretive transaction which adds
the portfolio of Omega’s existing policies and management
expertise. The transaction provides us with enhanced capacity to
support our future reinsurance operations while continuing
to provide outsourced services for foreign insurance carriers
in Canada,” said William M. Sheriff, Till Capital Chairman and CEO.
“I look forward to working with Phil Cook who will lead the
expansion of Till’s insurance activities. His decades of experience
along with his established staff will be valuable additions to our
team.”
Phil Cook, Chief Executive Officer of Omega added, "We look
forward to working with Till Capital as we enter the next phase of
Omega's development. Till's international footprint, along
with a proven track record of successful
investment strategies, will enable our combined
organizations to achieve our corporate objectives
while continuing to serve the needs of our policyholders and
other stakeholders."
Omega Insurance Holdings, Inc.With over $40 million in
assets and operating since 2004, Omega’s mission is to offer
secure, innovative and customized solutions for Insurers/Reinsurers
exiting the market and organizations with unique insurance needs in
a cost effective manner by a team of dedicated professionals. Omega
is 77% owned by Integrated Partners Limited Partnership One, a
division of Integrated Asset Management Corp. of Toronto.
Omega’s expertise in both the Canadian run-off phase and the
Canadian start-up phase for a foreign insurance company gives Omega
a strategic advantage in its two main target markets:
1. To provide those insurers wishing to
access the Canadian market an ability to do so in the most
efficient manner, through fronting arrangements and other creative
solutions;2. To provide those insurers wishing to exit Canada
through a dedicated company deep in experience in handling
“run-off” business an ability to facilitate such an exit, so that
their financial, legal, and moral obligations are met on a
continuing basis, while being able to repatriate their surplus
capital in a more timely fashion.
Philip H. Cook, M.B.A., F.C.I.P. -
Chief Executive OfficerServing as Omega’s Chief
Executive Officer since 2004, Mr. Phil Cook entered the Insurance
Industry in 1962 and has worked in a variety of capacities with
companies in England, Canada and the United States. From a
background in Claims and Claims Management he moved to
Administration, Operation and General Management. Before
establishing Focus Group Inc. in 1986, he was the Chief Executive
Officer for a major Insurer. His qualifications and his extensive
practical experience make him uniquely qualified to consult, advise
and handle any aspect of Insurance Management. His specialties
include: claims management, strategic planning, risk management,
feasibility studies, seminars, internal operations, IBNR
calculations, audits and all areas of general management. He is
presently Chief Agent for 4 Insurers/Reinsurers operating in the
Canadian marketplace.
Matthew P. Cook, C.A., B.B.A. - Chief
Financial OfficerServing as Omega’s Chief Financial
officer since 2004, Mr. Matthew Cook entered the insurance industry
in 2004, after working at a number of companies in various
industries. His Chartered Accountant designation and background has
provided him with extensive experience in financial reporting,
auditing, tax, financial systems, IT systems, and general
management.
Transaction DetailsThe letter of intent contemplates that
the Company will pay an aggregate purchase price of 1.2 times book
value, or approximately $15,400,000 as of March 31, 2014, plus an
amount not to exceed $3,000,000 for any transactions in process at
closing, in exchange for all of the issued and outstanding shares
of Omega.
The aggregate purchase price will be payable as follows: (i) at
the closing of the Proposed Transaction (and 90 days from the date
of completion of any qualifying transactions in progress at
closing), Till will pay to the Omega shareholders 95% of the
purchase price in cash and (ii) 12 months after the closing of the
Proposed Transaction, Till will pay to the Omega shareholders 5% of
the purchase price in cash. The payment at 12 months following
closing of the Proposed Transaction is subject to reduction in the
event losses incurred on the policies purchased from Omega are
greater than 10% above the actual loss reserves pursuant to the
financial statements prepared as of the most recent quarter end
prior to the closing date. Insiders of Omega will be permitted to
receive shares of Till in lieu of the 95% cash payment. In the
event the insiders elect to receive shares of Till, the value per
share will be the VWAP for the 5-day period ending on the day
immediately prior to the closing date of the Proposed Transaction
less the maximum discount allowed by the TSX Venture Exchange, but
in no event will the value be less than $9.50 per share. The 5%
cash payment due 12 months from closing will in all cases be paid
in cash.
Should the Proposed Transaction be completed, Omega will become
a wholly-owned subsidiary of the Company. It is expected that Mr.
Phil Cook will continue to hold the position of Chief Executive
Officer of Omega and Mr. Matthew Cook will continue to hold the
position of Chief Financial Officer of Omega upon closing of the
Proposed Transaction.
Pursuant to the letter of intent, the shareholders of Omega have
agreed to negotiate and deal exclusively with the Company until the
earlier of August 19, 2014 or the date of termination of the letter
of intent, provided that Omega may pay in the alternative a
break-up fee of CAD$500,000 to the Company.
The parties are currently negotiating definitive terms and
documents for the Proposed Transaction, which documents will
contain customary representations, warranties, covenants,
indemnities and other ancillary agreements to the extent
appropriate for transactions of the type of the Proposed
Transaction.
As of the date hereof, there is no assurance that the Company
will consummate the Proposed Transaction. Completion of the
Proposed Transaction is subject to a number of conditions,
including the negotiation and settlement of definitive terms for
the Proposed Transaction and the entering into of a definitive
share purchase agreement among the parties, completion of due
diligence, approval of Canada’s Office of the Superintendent of
Financial Institutions, receipt of respective board approvals,
receipt of approval of the TSX Venture Exchange, and receipt of
certain other customary consents.
Till Capital Ltd.Till Capital is a unique
Bermuda-domiciled company engaged in the reinsurance business
supported by a hybrid investment strategy. This non-traditional
approach creates a company with diversified investments including
royalties and physical gold, well-positioned for future growth
through access to and strategic deployment of capital. Our goal: to
maximize opportunity; mitigate risk; and invest in assets and
opportunities with significant upside potential.
For additional information:
Till Capital Ltd.William M. SheriffChairman and
Chief Executive Officer(208) 635
5415info@tillcap.comwww.tillcap.com
Cautionary NoteThe Till shares are restricted voting
shares, whereby no single shareholder of Till is able to exercise
voting rights for more than 9.9% of the voting rights of the total
issued and outstanding Till shares (the "9.9% Restriction”).
However, if any one shareholder of Till beneficially owns, or
exercises control or direction over, more than 50% of the issued
and outstanding Till shares, the 9.9% Restriction will cease to
apply to the Till shares.
This news release shall not constitute an offer to sell or a
solicitation of an offer to buy any securities of Till or any other
securities, and shall not constitute an offer, solicitation or sale
in any state or jurisdiction in which such an offer, solicitation
or sale would be unlawful. Trading in the securities of Till should
be considered speculative.
Neither the TSX Venture Exchange nor its Regulatory Service
Provide (as that term is defined in the policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
Cautionary Statement Regarding Forward Looking
InformationExcept for statements of historical fact, this news
release contains certain “forward-looking information” within the
meaning of applicable securities law. Forward-looking information
is frequently characterized by words such as “plan”, “except”,
“project”, “intend”, “believe”, “anticipate”, “estimate”, “will”,
“could” and other similar words, or statements that certain events
or conditions “may” occur. Such forward-looking statements are
subject to risks and uncertainties that may cause actual results,
performance or developments to differ materially from those
contained in the statements. These and all subsequent written and
oral forward-looking information are based on estimates and
opinions of management on the dates they are made and are expressly
qualified in their entirety by this notice. Except as required by
law, Till assumes no obligation to update forward-looking
information should circumstances or management’s estimates or
opinions change.
Till Capital Ltd.William M. Sheriff, 208-635-5415Chairman and
Chief Executive Officerinfo@tillcap.comwww.tillcap.com
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