FBD Holdings PLC ?70 million Capital Investment (2935Z)
September 16 2015 - 11:00AM
UK Regulatory
TIDMFBH
RNS Number : 2935Z
FBD Holdings PLC
16 September 2015
FBD Holdings plc
16 September 2015
EUR70 million Capital Investment
FBD Holdings plc ("FBD" or the "Company" or with its
subsidiaries the "Group") is pleased to announce that it has
entered into an agreement pursuant to which Fairfax Financial
Holdings Limited ("Fairfax") will invest EUR70 million in FBD
through a private placement of a convertible bond instrument (the
"Convertible Bond"). The transaction will be subject to FBD
shareholder approval.
The Convertible Bond will be a 10 year Solvency II compliant
instrument and it will carry a coupon of 7.0% per annum which will
be payable semi-annually. The conversion price has been set at
EUR8.50, a 37% premium over the closing share price on 15 September
2015. Unless previously redeemed, the Convertible Bond will be
exercisable from year 3 to year 10 and, in the event that the 30
day volume weighted average share price exceeds the conversion
price for a period of 180 days, the Convertible Bond will
automatically convert into ordinary shares in FBD at the conversion
price.
The issue of the Convertible Bond to Fairfax is subject to the
execution of a final, definitive agreement between the parties and
shareholder approval. As an interim stage in this transaction,
agreement has also been reached with Fairfax, that FBD Insurance
plc will today issue at 12% per annum, EUR70 million, 10 year, tier
2 instrument to Fairfax (the "Tier 2 Debt Instrument"). The Tier 2
Debt Instrument will be exchanged for the Convertible Bond within 7
days of Group shareholders approving the issue of Convertible
Bond.
Commenting, Interim Chief Executive, Fiona Muldoon, said:
"This is a significant vote of confidence in FBD and in our
future success. I am confident that the completion of this
transaction helps our business plan with our core farming and small
business customers and with our consumer customers also. It
underpins the Board's strong commitment to maintain healthy capital
buffers as we prepare for the implementation of Solvency II."
Mr. Michael Berkery, Group Chairman added:
"I welcome Fairfax as a key additional investor in FBD. I am
confident that Fairfax will be a good strategic partner for the
Group as we advance our plans to return to profitability. The Board
will strongly recommend this transaction to shareholders for
approval given the clear benefits accruing to the Group and our
shareholders."
Commenting, Prem Watsa, Chairman and CEO of Fairfax said:
"Fairfax is delighted to become an investor in and partner to
FBD. We have been a long-standing follower of FBD and its deserved
reputation as a leader in the farm insurance sector in Ireland.
This investment underlines our belief in the strength of Ireland's
on-going economic recovery and in FBD's core franchise in the
farming and agri-business sectors."
ENDS
For Reference:
FBD Holdings plc Telephone
Fiona Muldoon, Interim Chief Executive +353 1 409 3208
Peter Jackson, Head of Investor Relations
Conor Gouldson, Company Secretary
About FBD Holdings plc ("FBD")
The FBD Group was established in the 1960s is one of Ireland's
largest property and casualty insurers looking after the insurance
needs of farmers, private individuals and business owners.
About Fairfax Financial Holdings Limited ("Fairfax")
Fairfax is a holding company which, through its subsidiaries, is
engaged in property and casualty insurance and reinsurance and
investment management. Fairfax's corporate objective is to achieve
a high rate of return on invested capital and build long-term
shareholder value. Fairfax seeks to differentiate itself by
combining disciplined underwriting with the investment of its
assets on a total return basis, which Fairfax believes provides
above-average returns over the long-term.
Fairfax was founded in 1985 by the present Chairman and Chief
Executive Officer, V. Prem Watsa. The company has been under
present management since 1985 and is headquartered in Toronto,
Canada. Its common shares are listed on the Toronto Stock Exchange
under the symbol FFH and in U.S. dollars under the symbol
FFH.U.
Fairfax's insurance and reinsurance companies operate on a
decentralized basis, with autonomous management teams applying a
focused underwriting strategy to their markets. Fairfax
subsidiaries provide a full range of property and casualty
products, maintaining a diversified portfolio of risks across all
classes of business, geographic regions, and types of insureds.
The following details relate to FBD's ordinary shares of EUR0.60
each which are publicly traded:
Listing Irish Stock Exchange UK Listing Authority
Listing Category Dual Premium (Equity)
Trading Venue Irish Stock Exchange London Stock Exchange
Market Main Securities Main Market
Market
ISIN IE0003290289 IE0003290289
Ticker EG7.IR FBH.L
FBD Holdings plc FBD House, Bluebell, Dublin 12
Registered in Dublin, Ireland Registered Number 135882
This information is provided by RNS
The company news service from the London Stock Exchange
END
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