TIDMFBH
RNS Number : 4306C
FBD Holdings PLC
01 October 2018
NOT FOR DISTRIBUTION IN OR INTO OR TO ANY PERSON LOCATED OR
RESIDENT IN THE UNITED STATES, ITS TERRITORIES AND POSSESSIONS
(INCLUDING PUERTO RICO, THE U.S. VIRGIN ISLANDS, GUAM, AMERICAN
SAMOA, WAKE ISLAND AND THE NORTHERN MARIANA ISLANDS, ANY STATE OF
THE UNITED STATES AND THE DISTRICT OF COLUMBIA) OR TO ANY U.S.
PERSON (AS DEFINED IN REGULATION S OF THE UNITED STATES NOTES ACT
OF 1933, AS AMENDED) OR IN ANY JURISDICTION WHERE IT IS UNLAWFUL TO
RELEASE, PUBLISH OR DISTRIBUTE THIS ANNOUNCEMENT
This announcement contains a public disclosure of inside
information under Regulation (EU) 596/2014.
1 October 2018
FBD Holdings plc ("FBD" or "FBD Group")
FBD Insurance plc ("FBD Insurance")
Proposed purchase and cancellation of convertible debt and
potential issuance of new EUR50m Tier 2 subordinated notes
FBD is pleased to announce that FBD Insurance has entered into
an agreement to purchase and cancel the EUR70,000,000 7%
Convertible Notes (the "Existing Notes") currently held by certain
affiliates of Fairfax Financial Holdings Limited (collectively
"Fairfax") for approximately EUR86 million in cash, which will be
funded through a combination of existing cash resources and a new
issue of subordinated notes (the "Transaction").
The purchase of the Existing Notes is subject to certain
conditions (including any required regulatory approvals). As part
of the Transaction, FBD Insurance is proposing to issue
EUR50,000,000 of new Callable Dated Deferrable Subordinated Notes
due 2028 (the "New Notes"). FBD has appointed Goodbody Stockbrokers
UC as Sole Lead Manager (the "Manager") and the New Notes are
expected to be placed with institutional investors.
Background to the Transaction
In 2015, FBD Insurance issued the Existing Notes to Fairfax, to
strengthen FBD's capital position ahead of the implementation of
Solvency II and to position it for future growth.
The Existing Notes carry a 7 per cent coupon and are convertible
into ordinary shares in FBD at a conversion price (subject to
adjustment in specified circumstances) of EUR8.50 per share at any
time between 23 September 2018 and 23 September 2025 at the option
of the holder. A mandatory conversion would occur if the 30-day
volume weighted average price of FBD shares exceeds EUR8.50 per
share for 180 days from 23 September 2018. On conversion, 8,235,294
new FBD shares would be issued to Fairfax.
Rationale for the Transaction
The consideration for purchase of the Existing Notes represents
a discount of approximately 3 per cent to the 6 month volume
weighted average price as at 28 September 2018, the last business
day prior to this announcement.
The Transaction will have a number of benefits for
shareholders:
-- Existing shareholders will not suffer any dilution;
-- It will optimise and simplify FBD's capital structure;
and
-- It is expected to reduce ongoing interest costs, which over
time should provide increased dividend potential for
shareholders.
As at 30 June 2018, FBD had net assets of EUR280.4m and held the
Existing Notes as a EUR53.3m liability and EUR18.2m in equity.
Following completion of the Transaction, on an unaudited pro-forma
basis as at 30 June 2018 FBD would have net assets of EUR247.6m and
FBD Insurance's solvency capital ratio will remain in a very
healthy position, above its target range of 120% to 140%.
Commenting on the transaction,
Fiona Muldoon, CEO of FBD said:
"This transaction is a great result for our loyal shareholders.
It avoids any dilution of their existing shareholdings and ensures
that FBD continues to maintain a very strong capital position.
Fairfax's investment in 2015 was a meaningful endorsement of our
business when we needed it and they have been a fantastic partner.
We wish them well. The staff, management team and I look forward to
continuing to grow FBD as the only indigenous Irish insurer and to
expanding our business in both urban and rural Ireland."
Liam Herlihy, Chairman of FBD said:
"We would like to thank Fairfax for their investment in FBD. We
are proud of FBD's 50 year heritage and we look forward to the
future with confidence."
Enquiries Telephone
FBD Holdings plc
Paul Murphy + 353 01 409 3494
Powerscourt
Jack Hickey + 353 83 448 8339
About FBD Holdings plc ("FBD")
FBD is one of Ireland's largest property and casualty insurers,
looking after the insurance needs of farmers, consumers and
business owners. Established in the 1960s by farmers for farmers,
FBD has built on those roots in agriculture to become a leading
general insurer serving the needs of its direct agricultural, small
business and consumer customers throughout Ireland. It has a
network of 34 branches nationwide.
Forward Looking Statements
Some statements in this announcement are forward-looking. They
represent expectations for the Group's business, and involve risks
and uncertainties. These forward-looking statements are based on
current expectations and projections about future events. The FBD
Group believes that current expectations and assumptions with
respect to these forward-looking statements are reasonable.
However, because they involve known and unknown risks,
uncertainties and other factors, which are in some cases beyond the
FBD Group's control, actual results or performance may differ
materially from those expressed or implied by such forward-looking
statements.
Other Information
This Announcement does not constitute an offer of securities and
it is not a prospectus or a prospectus "equivalent" document.
The distribution of this Announcement and the offering of the
securities referred to in this Announcement in certain
jurisdictions may be restricted by law. No action has been taken by
FBD, FBD Insurance or the Manager that would permit an offering of
such securities or possession or distribution of this Announcement
or any other offering or publicity material relating to such
securities in any jurisdiction where action for that purpose is
required. Persons into whose possession this Announcement comes are
required by the FBD, FBD Insurance and the Manager to inform
themselves about, and to observe, such restrictions.
This Announcement is not for publication, distribution or
release, directly or indirectly, in or into the United States
(including its territories and dependencies, any State of the
United States and the District of Columbia). None of the securities
referred to in this Announcement have been or will be registered
under the US Securities Act of 1933 (as amended) (the "Securities
Act"), and may not be offered or sold in the United States or to,
or for the account or benefit of, US persons except subject from an
exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act. Neither this
Announcement nor the information contained herein constitutes or
forms part of an offer to sell or the solicitation of an offer to
buy securities in the United States. There will be no public offer
of any securities in the United States or in any other
jurisdiction.
In member states of the EEA, this announcement and any offer of
securities if made subsequently is directed only at persons who are
"qualified investors" within the meaning of Article 2(1)(e) of the
Prospectus Directive ("Qualified Investors"). Any person in the EEA
who acquires securities in any offer of securities (an "investor")
or to whom any offer of securities is made will be deemed to have
represented and agreed that it is a Qualified Investor. Any
investor will also be deemed to have represented and agreed that
any securities acquired by it in the offer have not been acquired
on behalf of persons other than Qualified Investors in Ireland
and/or other Member States (where equivalent legislation exists)
for whom the investor has authority to make decisions on a wholly
discretionary basis, nor have the securities been acquired with a
view to their offer or resale to persons other than such Qualified
Investors.
The price of securities and any income from them may go down as
well as up and investors may not get back the full amount invested
on disposal of such securities.
Neither the content of FBD's website nor any website accessible
by hyperlinks on the FBD's website is incorporated in, or forms
part of, this Announcement.
No representation or warranty, express or implied, is or will be
made as to, or in relation to, and no responsibility or liability
is or will be accepted by the Manager or by any of their respective
affiliates or agents as to or in relation to, the accuracy or
completeness of this Announcement or any other written or oral
information made available to or publicly available to any
interested party or its advisers, and any liability therefore is
expressly disclaimed.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
CARWGUQUBUPRGQU
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