Omega: Byrne Deal Is ‘Terminated’
Lloyd’s of London insurer Omega today [Dec.13] said it considered an offer by Haverford to purchase a 25 percent stake in the company to be terminated, insisting the Bermuda firm had not honoured its original terms.
Earlier this month Haverford, led by Bermuda-based insurance entrepreneur Mark Byrne [pictured], said it wanted to lower its price for the holding in Omega.
This followed a downbeat trading update from Omega in October which saw the insurer reveal $9 million in fresh catastrophe-related losses.
Haverford had originally wanted to buy into Omega through a so-called Dutch auction, in which shareholders were invited to submit their minimum acceptable sale price within a range between 70 pence and 83p a share.
Omega investors offered to sell 162.2m shares, more than double the 60.2m Haverford was seeking, at the maximum price of 83p, valuing the stake at about £50 million.
Haverford effectively walked away from the prospective deal in early December.
Omega’s Statement Appears In Full Below:
Following consultation with all of the Company’s major institutional shareholders the Omega Board wishes, inter alia, to confirm the position in respect of Haverford (Bermuda) Limited (“HBL”).
The Omega Board has been notified that following the announcement from HBL on 2 December 2011 that HBL considers the Offer to have lapsed, HBL has returned share certificates and acceptance forms to Omega Shareholders who tendered their shares.
Separately HBL has advised the Omega Board that the hearing of the Delaware Insurance Commissioner, which was scheduled for 12 December 2011, has been cancelled and that HBL considers the Implementation Agreement between Omega and HBL to have terminated.
The Omega Board reiterates that it believes the Offer, for which the Strike Price was 83p, would have become unconditional in all respects if HBL had complied with the terms of the Offer and the Implementation Agreement and honoured the valid tenders it received.
Along with many of our peers, the Group has experienced significant catastrophe losses during 2011, however our capital position continues to be more than adequate. We have increased our participation in Syndicate 958 for the 2012 year of account to 48.8% from 40.5% which when combined with the quota share reinsurance of the Syndicate brings the Group’s overall economic interest in the Syndicate to 59.0% (52.4% in 2011).
The business is focussing on the January renewals, targeting the better priced areas of business where we are seeing signs of an improving rating environment in our core books.
A Bermuda insurance firm not honouring its word???
I can’t imagine such a thing.
/sarcasm off