TIDMCAT
RNS Number : 8466G
CATCo Reinsurance Opps Fund Ltd
18 May 2011
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT
FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY,
IN, INTO OR FROM THE UNITED STATES, AUSTRALIA, CANADA, SOUTH AFRICA
OR JAPAN OR ANY JURISDICTION IN WHICH SUCH PUBLICATION OR
DISTRIBUTION IS UNLAWFUL
CATCo Reinsurance Opportunities Fund Ltd.
("CATCo" or the "Company")
Result of Placing of new C-shares of US$0.0001 each to raise USD
124.4 million
INTRODUCTION
CATCo is pleased to announce today that it has raised gross
proceeds of USD 124.4 million (approximately USD 121.1 million net
of commissions and expenses) through the issue of 124,446,737
C-shares (CATC.L) at a price of $1.00 per C-Share (the "Placing
Price") with institutional investors (the "Placing").
These 124,446,737 new C Shares form the First Closing of a wider
placing of up to 400 million New Shares which opens on 18 May 2011,
and will close on the earliest of (i) the first anniversary of the
date of this Announcement, (ii) the date on which an aggregate of
400 million New Shares have been admitted to trading on the
Specialist Fund Market ("SFM") and (iii) such other date as may be
agreed between the Company, CATCo Investment Management Ltd. (the
"Investment Manager") and Numis Securities Limited (the "Placing
Agent").
TIMETABLE:
For the First Closing
Admission of the first tranche of New Shares 20 May 2011
to trading on the London Stock Exchange's Specialist
Fund Market
------------------------------------------------------ ------------
CREST accounts to be credited in respect of 20 May 2011
the Depository Interests representing the first
tranche of New Shares
------------------------------------------------------ ------------
Admission of the first tranche of New Shares 20 May 2011
and the existing Ordinary Shares to trading
on the Bermuda Stock Exchange
------------------------------------------------------ ------------
Application has been made for these new C Shares to be admitted
to trading on the London Stock Exchange's Specialist Fund Market.
Trading is expected to commence on 20 May 2011. On Admission the
Company will have in issue 87,642,000 Ordinary Shares and
124,446,737 new C-Shares
The full terms and conditions of the Placing are set out in the
Appendix to this Announcement.
BACKGROUND TO AND REASONS FOR THE PLACING:
The extraordinary events of the last few months, including the
natural disasters in Australia, New Zealand and Japan, have led to
billions of dollars of losses in the reinsurance industry. As a
consequence, reinsurers are seeking additional retrocessional
protection leading to a significant increase in premium rates.
The Board is proposing to raise further capital by issuing New
Shares which it is intended will allow the Company to take
advantage of the current higher premium rates with the aim of
providing better returns to Shareholders and will enable the
Investment Manager to further diversify the Current Portfolio. The
issue of further Shares will spread operating costs over a larger
capital base which will cause the total expense ratio per Share to
fall and will also assist the Company to meet the Net Asset Value
targets set out in the prospectus issued at the initial public
offering of the Company.
The Directors believe that the issue of New Shares should be
beneficial to the Company in that they will:
- allow the Company, through its investment in the Master Fund,
to take advantage of the current higher premium rates with the aim
of providing better returns to Shareholders;
- enable existing Shareholders to subscribe for New Shares and
provide other investors with an opportunity to make an investment
in the Company;
- enable the Investment Manager to further diversify the Current
Portfolio;
- facilitate the Company's raising of further equity capital by
permitting the Company to offer New Shares that are not exposed to
liabilities or potential liabilities arising from events that
pre-date the issuance of such New Shares; and
- grow the Company, thereby spreading operating costs over a
larger capital base which will cause the total expense ratio per
Share to fall and will also assist the Company to meet its Net
Asset Value targets.
Raising further capital is also consistent with the published
aim of the Company to grow its Net Asset Value over the first two
years following launch and meet its Net Asset Value targets of
US$150 million by 31 December 2011 and US$200 million by 31
December 2012.
The Board, based upon information received from the Investment
Manager, does not currently believe that the Company will
ultimately suffer any losses arising from the New Zealand and the
Japanese earthquakes which occurred in the first quarter of 2011.
However, potential exposure to these events, including future
unearned premiums, has been designated by the Master Fund as Side
Pocket Investments which will be owned entirely by Master Fund
shareholders (including the Company) on 31 March 2011 on a pro rata
basis. All investment received from new investors on or after 1
April 2011 will have no exposure to such Side Pocket Investments,
nor the future unearned premium or any potential losses arising
from them.
THE PLACING:
The 124,446,737 new C Shares which form the first closing are a
separate class of Shares in the capital of the Company.
The Company intends to use the net proceeds of issues of C
Shares to subscribe for Master Fund Shares shortly after the C
Shares are issued so that the net proceeds of an issue of C Shares
will be invested shortly after their issue. The proceeds of an
issue of C Shares will be invested in Master Fund Shares but will
not participate in any shares which represent a Side Pocket
Investment ("SP Shares") issued to the Company in respect of any
events that have occurred before the date on which such C Shares
are issued. In this way C Shares will, shortly after their issue,
be exposed to the Master Fund's portfolio in the same way that
Ordinary Shares are, except that the C Shares will not be exposed
to potential losses and premiums attributable to events that have
occurred before the date on which they are issued.
Application will be made to the UK Listing Authority and to the
London Stock Exchange plc for the new C Shares to be admitted to
trading on the Specialist Fund Market ("SFM"), a market operated by
the London Stock Exchange. It is expected that such admission will
become effective at 8a.m. on 20 May 2011.
The First Closing is conditional upon, inter alia, Admission
becoming effective, the Placing Agreement becoming unconditional
and not being terminated prior to Admission, and not less than 50
million C Shares being subscribed for in aggregated pursuant to the
First Closing.
CONVERSION OF FIRST CLOSING C SHARES INTO ORDINARY SHARES
In respect of the tranche of C Shares issued at the First
Closing, it is intended that such C Shares will convert into
Ordinary Shares shortly after the date on which the Side Pocket
Investment attributable to the New Zealand and the Japanese
earthquakes is no longer designated as such and the relevant SP
Shares held by the Company in respect of such exposures have
converted back into Master Fund Shares.
Subsequent tranches of C Shares will convert into Ordinary
Shares on the basis of the Conversion Ratio which will be
calculated at such time as the Directors shall have elected, as at
the date of issue of such tranche of C Shares, to designate as the
"Calculation Time" in relation to that tranche of C Shares,
provided that at least 80 per cent. of the assets attributable to
such tranche of C Shares have been invested in accordance with the
Company's investment policy.
PROSPECTUS
Copies of the prospectus will be posted to shareholders and
submitted to the National Storage Mechanism tomorrow and will
shortly be available for inspection at
www.hemscott.com/nsm.do. The prospectus will also be available
at www.catcoim.com.
Defined terms used in this Announcement shall have the same
meaning as ascribed to them in the Company's prospectus dated 18
May 2011.
For further information contact:
CATCo Reinsurance Opportunities Fund Ltd +1 (441) 531 2227
Jason Bibb (Chief Operating Officer) +44 (0) 7786 116
Mark Way (Corporate Communications Director) 991
----------------------------------------------- ------------------
Numis Securities Limited
David Benda (Corporate Broking)
Hugh Jonathan (Corporate Finance) 0207 260 1000
----------------------------------------------- ------------------
This information is provided by RNS
The company news service from the London Stock Exchange
END
ROISFAFEAFFSEII
Catco Reinsurance Opport... (LSE:CAT)
Historical Stock Chart
From Sep 2024 to Oct 2024
Catco Reinsurance Opport... (LSE:CAT)
Historical Stock Chart
From Oct 2023 to Oct 2024