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Till Capital Announces Signing of Letter of Intent with Omega Insurance Holdings, Inc.HAMILTON, Bermuda --(Business Wire)-- 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. 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;
Philip H. Cook, M.B.A., F.C.I.P. - Chief
Executive Officer
Matthew P. Cook, C.A., B.B.A. - Chief Financial
Officer
Transaction Details 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. For additional information:
Till Capital Ltd.
Cautionary Note 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 Information
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