Fairfax Announces Successful Completion of CPPIB and OMERS Investment in 9.99% of Odyssey Group
December 15 2021 - 5:02PM
Fairfax Financial Holdings Limited (“Fairfax”) (TSX: FFH and FFH.U)
announces the successful completion of the previously announced
transaction in which an affiliate of CPPIB Credit Investments Inc.,
a wholly-owned subsidiary of Canada Pension Plan Investment Board,
and OMERS, the defined benefit pension plan for Ontario’s municipal
sector employees, will each acquire a 4.995% interest in Fairfax’s
subsidiary, Odyssey Group Holdings, Inc., through a new class of
securities, for an aggregate cash purchase price of US$900 million
(the “Odyssey Group Transaction”).
Fairfax intends to use the proceeds from the
Odyssey Group Transaction to fund its previously announced offer to
repurchase for cancellation up to US$1.0 billion of its subordinate
voting shares for cash at a purchase price of not less than
US$425.00 and not more than US$500.00 per subordinate voting share
(the “Offer”).
The Offer will expire at 5:00 p.m. (Eastern
time) on December 23, 2021. Interested shareholders should consult
the formal offer to purchase and issuer bid circular, together with
the letter of transmittal and notice of guaranteed delivery (the
“Offer Documents”), for the terms and conditions of the Offer and
instructions for tendering subordinate voting shares to the Offer.
The Offer Documents were mailed to shareholders or their designated
brokers and are also available on SEDAR at www.sedar.com and on
EDGAR at www.sec.gov.
Fairfax is a holding company which, through its
subsidiaries, is primarily engaged in property and casualty
insurance and reinsurance and the associated investment
management.
For further
information, contact: |
John Varnell,
Vice President, Corporate Development, at |
|
(416) 367-4941 |
|
|
Certain statements contained herein may
constitute forward-looking statements and are made pursuant to the
“safe harbour” provisions of applicable Canadian securities laws.
Particularly, statements about the Offer and the use of proceeds
from the Odyssey Group Transaction are forward-looking statements.
Such forward-looking statements are subject to known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of Fairfax to be materially
different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Such
factors include, but are not limited to: uncertainty in the level
of shareholder participation in the Offer; failure to complete the
Offer due to conditions to the Offer not being satisfied or waived;
reduction in net earnings if our loss reserves are insufficient;
underwriting losses on the risks we insure that are higher or lower
than expected; the occurrence of catastrophic events with a
frequency or severity exceeding our estimates; changes in market
variables, including interest rates, foreign exchange rates, equity
prices and credit spreads, which could negatively affect our
investment portfolio; risks associated with the global pandemic
caused by a novel strain of coronavirus (“COVID-19”), and the
related global reduction in commerce and substantial downturns in
stock markets worldwide; the cycles of the insurance market and
general economic conditions, which can substantially influence our
and our competitors’ premium rates and capacity to write new
business; insufficient reserves for asbestos, environmental and
other latent claims; exposure to credit risk in the event our
reinsurers fail to make payments to us under our reinsurance
arrangements; exposure to credit risk in the event our insureds,
insurance producers or reinsurance intermediaries fail to remit
premiums that are owed to us or failure by our insureds to
reimburse us for deductibles that are paid by us on their behalf;
our inability to maintain our long term debt ratings, the inability
of our subsidiaries to maintain financial or claims paying ability
ratings and the impact of a downgrade of such ratings on derivative
transactions that we or our subsidiaries have entered into; risks
associated with implementing our business strategies; the timing of
claims payments being sooner or the receipt of reinsurance
recoverables being later than anticipated by us; risks associated
with any use we may make of derivative instruments; the failure of
any hedging methods we may employ to achieve their desired risk
management objective; a decrease in the level of demand for
insurance or reinsurance products, or increased competition in the
insurance industry; the impact of emerging claim and coverage
issues or the failure of any of the loss limitation methods we
employ; our inability to access cash of our subsidiaries; our
inability to obtain required levels of capital on favourable terms,
if at all; the loss of key employees; our inability to obtain
reinsurance coverage in sufficient amounts, at reasonable prices or
on terms that adequately protect us; the passage of legislation
subjecting our businesses to additional adverse requirements,
supervision or regulation, including additional tax regulation, in
the United States, Canada or other jurisdictions in which we
operate; risks associated with government investigations of, and
litigation and negative publicity related to, insurance industry
practice or any other conduct; risks associated with political and
other developments in foreign jurisdictions in which we operate;
risks associated with legal or regulatory proceedings or
significant litigation; failures or security breaches of our
computer and data processing systems; the influence exercisable by
our significant shareholder; adverse fluctuations in foreign
currency exchange rates; our dependence on independent brokers over
whom we exercise little control; impairment of the carrying value
of our goodwill, indefinite-lived intangible assets or investments
in associates; our failure to realize deferred income tax assets;
technological or other change which adversely impacts demand, or
the premiums payable, for the insurance coverages we offer;
disruptions of our information technology systems; assessments and
shared market mechanisms which may adversely affect our insurance
subsidiaries; and adverse consequences to our business, our
investments and our personnel resulting from or related to the
COVID-19 pandemic. Additional risks and uncertainties are described
in our most recently issued Annual Report which is available at
www.fairfax.ca and in our Base Shelf Prospectus (under “Risk
Factors”) filed with the securities regulatory authorities in
Canada, which is available on SEDAR at www.sedar.com. Fairfax
disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by applicable
securities law.
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