TIDMTAW
RNS Number : 4450O
Tawa PLC
18 September 2011
TAWA PLC ("TAWA")
Consortium and management team announce acquisition of
Whittington UK from the Whittington Group
Tawa, Skuld and Paraline combine forces to acquire the leading
provider of third-party syndicate management services at
Lloyd's
A consortium comprising Tawa Plc, Skuld, and Paraline Group,
Ltd. ("the Consortium") today announced a definitive agreement to
acquire Whittington Insurance Markets Limited("Whittington")
("WIM"), the London-market operations of Whittington Group and
Lloyd's leading provider of full, turnkey agency management
services in Lloyd's. The management team, led by Stephen Cane, CEO,
will become equity investors in the newly formed acquiring company
and will continue to manage this successful business that it has
built over the past eighteen years.
The transaction is subject to the approvals of Lloyd's and the
FSA and is expected to close within approximately 90 days.
Marcelli (Newco) Ltd ("NewCo") has been incorporated to acquire
WIM and has entered into an agreement to acquire 100% of WIM. The
total cash consideration will be funded through a combination of a
bank loan provided by Barclays Bank, preference shares and ordinary
shares, which will be subscribed for by the Consortium.
Tawa plc has agreed to invest GBP7 million in NewCo Limited, in
return for 33% of the preference shares and 30% of the ordinary
equity in NewCo. To finance the transaction, Tawa will draw down on
a new GBP15 million bank facility that has been arranged to support
this investment, facilitate further opportunities and for general
corporate purposes. The investment in NewCo will be equity
accounted in the Tawa report and accounts and the Barclays bank
loan provided to NewCo is non-recourse to Tawa. The transaction is
not expected to have a material impact on the net assets of
Tawa.Tawa expects that the investment in NewCo will increase
pre-tax consolidated earnings for the year ended 31 December 2012
by GBP1 million.
WIM provides Lloyd's managing agency services to existing and
start-up syndicates at Lloyd's. For the year ended 31 December
2010, WIM's consolidated (unaudited) profits before tax were GBP4.6
million and net tangible assets were GBP3.5 million.
Gilles Erulin, Chief Executive Officer of Tawa Plc,
commented:
"This transaction provides us with a platform through which to
expand our range of services to the Lloyd's community. Whittington
is the leading franchise in the Lloyd's agency management market
and provides us with real scale as a provider of live insurance
services. This is highly complementary with the range of consulting
and outsourcing services currently provided through Pro, and we
look forward to developing these businesses in tandem with one
another."
Stephen Cane, Chief Executive Officer of Whittington,
commented:
"We are extremely pleased with the acquisition by the Consortium
and also with the opportunity to participate in the ownership of
our Company. We look forward to continuing to provide highest
quality management services to our clients and maintaining the
trust of Lloyd's as a third party syndicate manager providing
turnkey and incubation services for new syndicates. Each of the
partners will provide strength and stability to our business. With
the support of our new ownership group, we will also now have the
ability to provide capital to selected new entrants to
Lloyd's."
Bruce Schnitzer, Chief Executive Officer of Paraline,
commented:
"We are always interested in partnering with high quality
management teams and other compatible firms. Whittington has a
distinguished history and is well respected in the Lloyd's
community. Its expertise will be of value to Paraline's Syndicate
4242 as we grow and develop additional underwriting classes.
"Our business model is built on a combination of underwriting
services, activities for others and application of our own
underwriting capital, particularly in times of market need. This
investment significantly furthers these objectives and is a welcome
addition to the Paraline portfolio."
Douglas Jacobsohn, Chief Executive Officer of Skuld added:
"Our plan in establishing Syndicate 1897 last year included the
creation of our own managing agency as soon as practicably
possible. This acquisition allows us to move that timetable forward
on a cost efficient basis. We are committed to continuing to expand
our involvement in the London market and beyond, as an extension of
our heritage as the world's leading P&I Mutual Club. We are
always looking for new ways in which we can provide first-class
service, and this arrangement enables us to continue to do that
across a wider platform. Moreover, the structure of this consortium
transaction very much encapsulates the way Skuld Group operates,
being innovative and groundbreaking."
ENDS
Enquiries:
Gilles Erulin 020 7068 8044
Chief Executive, Tawa plc
Peel Hunt LLP (nominated adviser
& broker)
James Britton
Guy Wiehahn 020 7418 8900
FWD PR
Victoria Sisson
Alexandra Thompson 020 7623 2368
Notes for Editors:
About Whittington Group
Whittington is an international insurance investment and service
business headquartered in Singapore. It is dedicated to providing
bespoke and innovative solutions to the insurance industry.
Whittington includes UK subsidiaries Whittington Insurance
Markets Ltd, Whittington Management Services Ltd, Whittington
Capital Management Ltd, and Whittington Insurance Services Ltd.
About Whittington Capital Management Limited
Whittington Capital Management Ltd ('WCM') is Whittington's
Lloyd's registered managing agent and is authorised by the
Financial Services Authority. It is the main operating company in
the UK. WCM offers a broad range of services:
-- Management of third party Syndicates
-- Turnkey and Incubation for new Lloyd's Syndicates
-- Consulting and advisory services
Whittington first became involved in Lloyd's start-up activities
in the mid 1990's and has successfully guidedfifteen syndicates
through the Lloyd's admissions process.
About Tawa Plc
Tawa plc was formed in 2001 with the purpose of acquiring or
developing assets and business in the insurance industry. Tawa is
interested in acquiring portfolios of insurance and reinsurance
companies, companies and businesses providing services to the
insurance industry and in developing its own products to serve the
insurance market as a whole.
Since its formation, Tawa has acquired CX Reinsurance Company
Limited, KX Reinsurance Company Limited, PXRE Reinsurance Company,
Island Capital Limited, the Pro group of companies and OX
Reinsurance Company Limited. It also set up QX Reinsurance Company
Limited, a Bermudian regulated reinsurance company, to write
reinsurance business.
The combined Tawa/Pro team of 300 professionals service a number
of the largest insurance businesses in the UK and Europe and
deliver a market-wide third-party servicing capability and cover
London's company and Lloyd's markets as well as Europe and the
USA.
Tawa also operates as an incubator for new projects and launched
the STRIPE(R) system in September 2010. STRIPE is a web based
platform enabling insurers and cedants to deal with their
(re)insurers directly, reducing re-processing of data. STRIPE
supports the single keying of data and allows the rapid and secure
delivery of all transactions.
In July 2007 Tawa plc was floated on the AIM market. Further
information can be found on the Company's website:
www.tawaplc.com
About Skuld
Skuld Group is a leading marine insurer providing Protection and
Indemnity (P&I), hull & machinery, cargo, energy and marine
liability cover to shipowners and charterers all over the
world.
Skuld P&I offers P&I for shipowners, specialist
liability covers for vessel charterers, defence insurance as well
as offshore cover. A wide variety of ancillary covers are tailored
to members' and clients' specific needs.
Through the 2010 launch of Syndicate 1897, Skuld Group provides
additional marine and energy covers such as hull & machinery,
energy packages and cargo insurance to members and clients.
Skuld Group's worldwide offices cover virtually every time zone
and are manned by a dedicated and professional staff representing
more than 20 nationalities, and thus many cultural backgrounds as
well as a wide variety of legal, nautical and technical
expertise.
Through a significant diversification, Skuld Group now provides
a comprehensive insurance package where Skuld P&I works
together with Skuld Offshore and Skuld 1897, placing members and
clients first.
About Paraline
Paraline Group, Ltd, a Bermuda-domiciled insurance and
reinsurance holding company, was established in August 2010. It
principal operating businesses are ICAT Managers, LLC, and Paraline
Re LTD, a Bermuda based reinsurer. ICAT Managers underwrites small
and middle market commercial properties located in
catastrophe-exposed regions of the United States on behalf of
Syndicate 4242 at Lloyd's and other leading insurers and
reinsurers. Paraline Re provides aligned underwriting capital to
s.4242. (For more information, visit www.icat.com)
Paraline is owned by its senior managers and private investors
that include Wand Partners and Elliott Management Corporation.
Paraline has the industry knowledge, investor expertise and capital
backing to expand thoughtfully by backing quality management teams
at times of market need.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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