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RNS Number : 1914O

Fairfax Financial Holdings Limited

26 May 2015

THIS ANNOUNCEMENT IS RESTRICTED AND IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO OR FROM ANY STATE OR JURISDICTION IN WHICH SUCH RELEASE, PUBLICATION OR DISTRIBUTION WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION

FOR IMMEDIATE RELEASE

26 May 2015

Recommended Cash Offer

for Brit plc ("Brit")

by FFHL Group Ltd. ("FGL")

an entity wholly-owned by Fairfax Financial Holdings Limited ("Fairfax")

Offer Declared Unconditional in All Respects, Commencement of Compulsory Acquisition Procedure and Delisting

   1.   Introduction 

On 17 February 2015, the boards of Fairfax and Brit announced the terms of a recommended cash offer through which the entire issued, and to be issued, ordinary share capital of Brit will be acquired by FGL, an entity wholly-owned by Fairfax (the "Offer"). The full terms and conditions of the Offer and the procedures for acceptance were set out in the offer document issued by FGL on 16 March 2015 (the "Offer Document"). On 23 March 2015, FGL announced that the Offer had been declared unconditional as to acceptances.

   2.   Offer declared unconditional in all respects 

As all conditions relating to the Offer set out in the Offer Document have now been satisfied or waived, FGL is pleased to announce that the Offer has been declared unconditional in all respects. Accordingly, cash consideration will be paid within 10 days of the date of this announcement to those Brit Shareholders whose valid acceptances have already been received. Payment of cash consideration in respect of valid acceptances received after the date of this announcement will be made within 10 days after receipt of each such acceptance.

Brit Shareholders who have not yet accepted the Offer are encouraged to do so without delay. Full details of how to accept the Offer are set out in the Offer Document, a copy of which is available on Fairfax's website at www.fairfax.ca/britoffer and Brit's website at www.britinsurance.com/ir/fairfax-offer.

The Offer will remain open for acceptance until further notice (such notice not to be less than 14 days).

   3.   Level of acceptances 

As at 16:26 (London time) on 22 May 2015, FGL had received valid acceptances of the Offer in respect of 372,423,871 Brit Shares, representing approximately 93 per cent. of the existing ordinary issued share capital of Brit. So far as FGL is aware, none of these acceptances have been received from persons acting in concert with FGL. Of these acceptances, acceptances have been received in respect of 294,953,274 Brit Shares (representing approximately 73.7 per cent. of the existing ordinary issued share capital of Brit) which were subject to irrevocable undertakings given by the Apollo Shareholders, the CVC Shareholders and the Director Shareholders.

   4.   Interests in Brit Shares 

As of 22 May 2015 (being the latest practicable date prior to the publication of this announcement), neither Fairfax nor FGL, nor any person acting in concert with either of them, is interested in, has any rights to subscribe for any relevant securities of Brit nor does any such person have any short position (whether conditional or absolute and whether in the money or otherwise), including any short position under a derivative or any arrangement in relation to any relevant securities of Brit. For these purposes, "arrangement" includes any agreement to sell or any delivery obligation or right to require another person to purchase or take delivery of any relevant securities of Brit and any borrowing or lending of any relevant securities of Brit which have not been on-lent or sold and any outstanding irrevocable commitment or letter of intent with respect to any relevant securities of Brit.

   5.   Compulsory acquisition of Brit Shares 

FGL has now unconditionally contracted to acquire not less than 90 per cent. of the Brit Shares by nominal value and not less than 90 per cent. of the voting rights attaching to such shares to which the Offer relates. Accordingly, FGL will today begin the implementation of the compulsory acquisition procedure to acquire the remaining Brit Shares under Chapter 3 of Part 28 of the Companies Act 2006 (the "Act"), as contemplated by the Offer Document.

FGL will today despatch formal compulsory acquisition notices under Sections 979 and 980 of the Act (the "Compulsory Acquisition Notices") to Brit Shareholders who have not yet accepted the Offer ("Remaining Shareholders"). These notices set out FGL's intention to apply the provisions of Section 979 of the Act to compulsorily acquire any remaining Brit Shares in respect of which the Offer has not been accepted, on the same terms as the Offer.

Unless any of the Remaining Shareholders who do not accept the Offer before FGL decides to close the Offer (of which not less than 14 days' notice will be provided) apply to the court and the court orders otherwise, on the expiry of six weeks from the date of the Compulsory Acquisition Notices, being 7 July 2015, the Brit Shares held by those Remaining Shareholders who have not accepted the Offer will be acquired compulsorily by FGL on the same terms as the Brit Offer. The consideration to which those Remaining Shareholders will be entitled will be held by Brit as trustee on behalf of those Remaining Shareholders who have not accepted the Brit Offer and they will be requested to claim their consideration by writing to Brit at the end of the six week period.

   6.   Delisting 

FGL is in receipt of valid acceptances in respect of more than 75 per cent. of the Brit Shares, and the Offer has been declared unconditional in all respects. As such, FGL hereby gives notice that the 20 Business Days' notice period for cancellation of (i) the listing of the Brit Shares on the premium listing segment of the Official List of the UK Listing Authority, and (ii) their admission to trading on the London Stock Exchange's main market for listed securities, has now begun. It is anticipated that cancellation of listing and trading will take effect no earlier than 8.00 a.m. (London time) on 23 June 2015.

Delisting will significantly reduce the liquidity and marketability of any Brit Shares not assented to the Offer.

   7.   Further acceptances of the Offer 

The Offer will remain open for acceptance until further notice.

If you hold your Brit Shares, or any of them in certificated form, that is, NOT in CREST, you should return your signed and completed Form of Acceptance along with your valid share certificate(s) and/or any other relevant documents of title, to the Receiving Agent by post at Computershare, Corporate Actions Projects, Bristol BS99 6AH or by hand (during normal business hours) at The Receiving Agent, Computershare Investor Services PLC at The Pavilions, Bridgwater Road, Bristol BS13 8AE as soon as possible. Further details on the procedures for acceptance of the Offer if you hold any of your Brit Shares in certificated form are set out in paragraph 15(a) of Part 2 of the Offer Document, Section C of Part 3 to the Offer Document and in the Form of Acceptance.

If you hold your Brit Shares, or any of them, in uncertificated form (that is, in CREST), to accept the Offer in respect of those Brit Shares, you should follow the procedure for Electronic Acceptance through CREST so that the TTE instruction settles as soon as possible. Further details on the procedures for acceptance of the Brit Offer if you hold any of your Brit Shares in uncertificated form are set out in paragraph 15(b) of Part 2 of the Offer Document and in Section D of Part 3 to the Offer Document. If you hold your Brit Shares as a CREST sponsored member, you should refer acceptance of the Offer to your CREST sponsor as only your CREST sponsor will be able to send the necessary TTE instruction to Euroclear.

A Brit Shareholder who has any questions relating to the Offer, or who is in any doubt as to how to complete the Form of Acceptance should contact Computershare Investor Services PLC between 8.30 a.m. and 5.30 p.m. (London time) Monday to Friday (except UK public holidays) on 0870 889 3156 from within the UK or +44 (0)870 889 3156 if calling from outside the UK. Calls from landline providers typically cost up to 12 pence per minute. Calls from mobile networks cost between 5 pence and 40 pence per minute. Calls from outside the UK are chargeable at applicable international rates. Calls may be recorded and randomly monitored for security and training purposes. Please note that, for legal reasons, the helpline will only be able to provide you with information contained in this document and cannot give advice on the merits of the Offer nor provide financial, legal or tax advice.

Full details on how to accept the Offer are set out in the Offer Document, a copy of which is available on Fairfax's website at www.fairfax.ca/britoffer and Brit's website at www.britinsurance.com/ir/fairfax-offer.

   8.   Settlement of the Offer 

Settlement of consideration to which any accepting Brit Shareholder is entitled under the Offer will be despatched as follows: (i) in the case of acceptances which have been received and are valid and complete in all respects by 1.00 p.m. on the date of this announcement, within 10 days; or (ii) in the case of acceptances which are valid and complete in all respects and received after the date of this announcement but while the Offer remains open for acceptance, within 10 days of such receipt, in each case in the manner described in the Offer.

Defined terms used but not defined in this announcement have, unless the context requires otherwise, the meanings set out in the Offer Document, a copy of which is available at www.fairfax.com/britoffer.

 
Enquiries: 
Fairfax 
                                         +1 (416) 367 
Paul Rivett, President                    4941 
RBC Capital Markets (Financial 
 adviser to Fairfax) 
Mark Preston 
 Alexander Thomas 
 Martin Frowde                           +44 (0)20 7653 
 Oliver Hearsey (Corporate Broking)       4000 
Brit 
Andrew Baddeley, Chief Financial 
 Officer 
 Joy Ferneyhough, Director of Strategy   +44 (0) 207 984 
 and Corporate Development                8800 
J.P. Morgan Cazenove (Financial adviser and corporate 
 broker to Brit) 
Dwayne Lysaght 
 Mike Collar                             +44 (0) 20 7777 
 Kamalini Hull                            2000 
Numis Securities (Financial adviser and corporate 
 broker to Brit) 
Charles Farquhar                         +44 (0)20 7260 
 Robert Bruce                             1000 
Willis Capital Markets (Financial 
 adviser to Brit) 
                                         +44 (0) 20 3124 
                                          8123 
Michiel Bakker                            +44 (0) 20 3124 
 John Philipsz                            8365 
FTI Consulting (Public Relations 
 adviser to Brit) 
                                         +44 (0) 20 3727 
                                          1341 
Paul Marriott                             +44 (0) 20 3727 
 Tom Blackwell                            1051 
 
   1.             About Fairfax 

Fairfax Financial Holdings Limited is a holding company which, through its subsidiaries, is engaged in property and casualty insurance and reinsurance and investment management. Fairfax was founded in 1985 by the present Chairman and Chief Executive Officer, Prem Watsa. Fairfax 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.

   2.             Further Information 

RBC Europe Limited (trading as RBC Capital Markets), which is authorised by the Prudential Regulation Authority and regulated in the United Kingdom by the Financial Conduct Authority and the Prudential Regulation Authority, is acting exclusively for Fairfax and no one else in connection with the Offer and will not be responsible to anyone other than Fairfax for providing the protections afforded to clients of RBC Capital Markets nor for providing advice in relation to the Offer or any other matter referred to in this announcement.

J.P. Morgan Limited, which conducts its UK investment banking businesses as J.P. Morgan Cazenove ("J.P. Morgan Cazenove"), is authorised and regulated in the United Kingdom by the Financial Conduct Authority. J.P. Morgan Cazenove is acting as financial adviser exclusively for Brit and no one else in connection with the matters set out in this announcement and will not regard any other person as its client in relation to the matters in this announcement and will not be responsible to anyone other than Brit for providing the protections afforded to clients of J.P. Morgan Cazenove, nor for providing advice in relation to any matter referred to herein.

Numis Securities Limited ("Numis"), is authorised and regulated in the United Kingdom by the Financial Conduct Authority. Numis is acting as financial adviser and broker exclusively for Brit and no one else in connection with the matters set out in this announcement and will not regard any other person as its client in relation to the matters in this announcement and will not be responsible to anyone other than Brit for providing the protections afforded to clients of Numis, nor for providing advice in relation to any matter referred to herein.

Willis Capital Markets & Advisory Limited ("Willis Capital Markets") is authorised and regulated in the United Kingdom by the Financial Conduct Authority. Willis Capital Markets is acting as financial adviser exclusively for Brit and no one else in connection with the matters set out in this announcement and will not regard any other person as its client in relation to the matters in this announcement and will not be responsible to anyone other than Brit for providing the protections afforded to clients of Willis Capital Markets, nor for providing advice in relation to any matter referred to herein.

This announcement is for information purposes only and is not intended to, and does not, constitute or form part of any offer, invitation, inducement or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of or exercise rights in respect of any securities, or the solicitation of any vote or approval of an offer to buy securities in any jurisdiction, pursuant to the Offer or otherwise. Any response in respect of the Offer should be made only on the basis of information contained in the Offer Document, which contains the full terms and conditions of the Offer, including how the Offer may be accepted. Brit Shareholders are advised to read the formal documentation in relation to the Offer carefully.

This announcement does not constitute a prospectus or prospectus-equivalent document.

This announcement has been prepared for the purpose of complying with English law, the Code and the Listing Rules of the Financial Conduct Authority and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside the United Kingdom.

   3.             Overseas jurisdictions 

The release, publication or distribution of this announcement in, and the availability of the Offer to persons who are residents, citizens or nationals of, jurisdictions other than the United Kingdom may be restricted by laws and/or regulations of those jurisdictions. Therefore, any persons who are subject to the laws and regulations of any jurisdiction other than the United Kingdom should inform themselves about and observe any applicable requirements in their jurisdiction. Any failure to comply with the applicable requirements may constitute a violation of the laws and/or regulations of any such jurisdiction.

In particular, copies of this announcement and any formal documentation relating to the Offer are not being, and must not be, directly or indirectly, mailed or otherwise forwarded, distributed or sent in or into or from any Restricted Jurisdiction and persons receiving such documents (including custodians, nominees and trustees) must not mail or otherwise forward, distribute or send it in or into or from any Restricted Jurisdiction. Unless otherwise permitted by applicable law and regulation, the Offer may not be made, directly or indirectly, in or into, or by the use of mails or any means or instrumentality (including, but not limited to, facsimile, e-mail or other electronic transmission, telex or telephone) of interstate or foreign commerce of, or of any facility of a national, state or other securities exchange of any Restricted Jurisdiction and the Offer may not be capable of acceptance by any such use, means, instrumentality or facilities.

The receipt of cash pursuant to the Offer by Brit Shareholders may be a taxable transaction under applicable national, state and local, as well as foreign and other tax laws. Each Brit Shareholder is urged to consult their independent professional adviser regarding the tax consequences of accepting the Offer.

   4.             Notice to US investors 

The Offer is being made for securities of a United Kingdom company and Brit Shareholders in the United States should be aware that this announcement, the Offer Document and any other documents relating to the Offer have been or will be prepared in accordance with the Code and UK disclosure requirements, format and style, all of which differ from those in the United States. Brit's financial statements, and all financial information that is included in this announcement or that may be included in the Offer Document, any other documents relating to the Offer, have been or will be prepared in accordance with International Financial Reporting Standards and may not be comparable to financial statements of companies in the United States or other companies whose financial statements are prepared in accordance with the US generally accepted accounting principles.

The Offer is made in the United States pursuant to applicable US tender offer rules and securities laws (or pursuant to exemptive relief therefrom granted by the United States Securities and Exchange Commission (the"SEC")) and otherwise in accordance with the requirements ofEnglish law, the Code, the Panel, the London Stock Exchange andthe Financial Conduct Authority. Accordingly, the Offer is subject to disclosure and other procedural requirements, including with respect to withdrawal rights, offer timetable, settlement procedures and timing of payments that are different from those applicable under United States domestic tender offer procedures and law.

Neither the SEC nor any US state securities commission has approved or disapproved the Offer or passed upon the adequacy or completeness of this Announcement or the Offer Document. It may be difficult for US holders of Brit securities to enforce their rights under and any claim arising out of the US federal securities laws, since Fairfax, FGL and Brit are located outside of the United States, and some or all of their officers and directors may be resident outside of the United States.

In accordance with, and to the extent permitted by, the Code, normal UK market practice and Rule 14e-5 under the United States Securities Exchange Act of 1934, as amended (the "Exchange Act"), RBC Capital Markets and J.P. Morgan Cazenove and their affiliates may continue to act as exempt principal traders in Brit Shares on the London Stock Exchange and will engage in certain other purchasing activities consistent with their respective normal and usual practice and applicable law, including Rule 14e-5 under the Exchange Act. To the extent required to be disclosed in accordance with applicable regulatory requirements, information about any such purchases will be disclosed on a next day basis to the Panel and will be available from any Regulatory Information Service, including the Regulatory News Service on the London Stock Exchange website, www.londonstockexchange.com. To the extent that such information is required to be publicly disclosed in the United Kingdom in accordance with applicable regulatory requirements, this information will as applicable also be publicly disclosed in the United States.

   5.             Disclosure requirements of the Code 

Under Rule 8.3(a) of the Code, any person who is interested in1 per cent. or more of any class of relevant securities of an offeree company or of any securities exchange offeror (being any offeror other than an offeror in respect of which it has been announced that its offer is, or is likely to be, solely in cash) must make an Opening Position Disclosure following the commencement of the offer period and, if later, following the announcement inwhich any securities exchange offeror is first identified. An Opening Position Disclosure must contain details of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror(s). An Opening Position Disclosure by a person to whom Rule 8.3(a) applies must be made by no later than 3.30 pm (London time) on the 10th business day following the commencement of the offer period and, if appropriate, by no later than 3.30 pm (London time) on the 10th business day following the announcement inwhich any securities exchange offeror is first identified. Relevant persons who deal in the relevant securities of the offeree company or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure must instead make a Dealing Disclosure.

Under Rule 8.3(b) of the Code, any person who is, or becomes, interested in 1 per cent. or more of any class of relevant securities of the offeree company or of any securities exchange offeror must make a Dealing Disclosure if the person deals in any relevant securities of the offeree company or of any securities exchange offeror. A Dealing Disclosure must contain details of the dealing concerned and of the person's interests and short positions in, and rights to subscribe for, any relevant securities of each of (i) the offeree company and (ii) any securities exchange offeror, save to the extent that these details have previously been disclosed under Rule 8. ADealing Disclosure by a person to whom Rule 8.3(b) applies must be made by no later than 3.30 pm (London time) on the business day following the date of the relevant dealing.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire or control an interest in relevant securities of an offeree company or asecurities exchange offeror, they will be deemed to be a single person for the purpose of Rule 8.3.

Opening Position Disclosures must also be made by the offeree company and by any offeror and Dealing Disclosures must also be made by the offeree company, by any offeror and by any persons acting in concert with any of them (see Rules 8.1, 8.2 and 8.4).

Details of the offeree and offeror companies in respect of whose relevant securities Opening Position Disclosures and Dealing Disclosures must be made can be found in the Disclosure Table on the Takeover Panel's website at www.thetakeoverpanel.org.uk including details of the number of relevant securities in issue, when the offer period commenced and when any offeror was first identified. You should contact the Panel's Market Surveillance Unit on +44 (0)20 7638 0129 if you are in any doubt as to whether you are required to make an Opening Position Disclosure or a Dealing Disclosure.

   6.             Information relating to Brit Shareholders 

Please be aware that addresses, electronic addresses and certain other information provided by Brit Shareholders, persons with information rights and other relevant persons for the receipt of communications from Brit may be provided to Fairfax during the offer period as required under Section 4 of Appendix 4 of the Code to comply with Rule 2.12(c) of the Code.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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