Possible Offer

RNS Number : 0433A

Catlin Group Limited

17 December 2014

 



Possible Offer

Catlin Group Limited (the "Company"), notes the recent press speculation regarding the Company and movement in the Company's share price.  The Company confirms that it has received an approach from XL Group ("XL") on a possible combination of XL and Catlin ("Possible Offer"), the key terms of which are set out below. A combination of XL and Catlin would create a leading player in property and casualty insurance and reinsurance and expand opportunities for the combined underwriting team in the global marketplace.

Under the indicative terms of the Possible Offer, XL would acquire 100% of Catlin for consideration of 410 pence in cash and 0.130 shares of XL for each Catlin common share. On the basis of the closing price of an XL share on 16 December of $35.01, an exchange rate of $1.573:£1 and a fully diluted share count of 386 million shares, the Possible Offer values each Catlin share at 699 pence. Under the terms of the Possible Offer, Catlin shareholders would not receive a final dividend for the year ended 31 December 2014.

Catlin also confirms that it is in advanced negotiations regarding the sale of its interest in Box Innovation Group Limited (trading as ITB). In the event a sale is agreed on terms which generate surplus capital, any distribution of that surplus to Catlin shareholders would be in addition to the indicative terms of the Possible Offer.

Discussions are currently ongoing between both parties and the final terms of any Possible Offer are subject to the completion of mutual due diligence. There can be no certainty that the discussions will lead to any transaction or any certainty as to the final terms on which any such transaction might proceed. A further announcement will be made in due course.

This announcement is being made without the agreement or approval of XL.

The City Code on Takeovers and Mergers

By virtue of its status as a Bermuda incorporated company, the City Code on Takeovers and Mergers (the City Code) does not apply to Catlin.  Catlin has incorporated certain takeover-related provisions into its bye-laws but these do not provide shareholders with the full protections offered by the City Code and enforcement of such provisions are the responsibility of Catlin, not the Panel on Takeovers and Mergers (the Panel). Accordingly, shareholders are reminded that the Panel does not have responsibility, in relation to Catlin, for ensuring compliance with the City Code and is not able to answer shareholders' queries.

In particular, public disclosures consistent with the provisions of Rule 8 of the City Code (as if it applied to the Company) should not be e-mailed to the Panel, but, as described below, released directly through a Regulatory Information Service.

Catlin confirms that as at the date of this announcement, it has in issue 362,524,994 shares of US$0.01 each. The International Securities Identification Number (ISIN) of the shares is BMG196F11004.

Disclosure

Catlin is a Bermudian entity and is therefore not subject to the City Code. Accordingly, shareholders of Catlin and others dealing in common shares of Catlin are not obliged to disclose any of their dealings under the provisions of the City Code.  However, market participants are requested to make disclosures of dealings as if the City Code applied and as if Catlin were in an "offer period" under the City Code.

Catlin's website contains the form of disclosure requested. If you are in any doubt as to whether or not you should disclose dealings, you should contact an independent financial adviser authorised by the Financial Conduct Authority (FCA) under the Financial Services and Markets Act 2000 (FSMA).

In light of the foregoing, as provided in Rule 8.3(a) of the City Code, any person who is "interested" in one per cent. or more of any class of "relevant securities" of Catlin 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") should make an Opening Position Disclosure following the commencement of the "offer period" and, if later, following the announcement in which any "securities exchange offeror" is first identified.

An Opening Position Disclosure should contain details of the person's interests and short positions in, and rights to subscribe for, any "relevant securities" of each of (i) Catlin and (ii) any "securities exchange offeror(s)". Persons to whom Rule 8.3(a) would have applied had the City Code been applicable should make an Opening Position Disclosure by no later than 3.30 pm (London time) on the tenth "business day" following the commencement of the "offer period" and, if appropriate, by no later than 3.30 pm (London time) on the tenth "business day" following the announcement in which any "securities exchange offeror" is first identified. Relevant persons who undertake "dealings" in the "relevant securities" of Catlin or of a securities exchange offeror prior to the deadline for making an Opening Position Disclosure should instead make a Dealing Disclosure.

Rule 8.3(b) of the Code provides that if any person is, or becomes "interested" (directly or indirectly) in one per cent. or more of any class of "relevant securities" of an offeree or of any "securities exchange offeror", all "dealings" in any "relevant securities" of that offeree or of any "securities exchange offeror" (including by means of an option in respect of, or a derivative referenced to, any such "relevant securities") should be publicly disclosed in a Dealing Disclosure by no later than 3.30 p.m. (London time) on the "business day" following the date of the relevant transaction.   In a situation where the City Code applies, this requirement would continue until the date on which any "offer" becomes, or is declared, unconditional as to acceptances, lapses or is otherwise withdrawn or on which the "offer period" otherwise ends.  Under Rule 8 of the City Code, a Dealing Disclosure would 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 (i) Catlin and (ii) any "securities exchange offeror", save to the extent that these details have previously been disclosed under Rule 8.

If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire an "interest" in "relevant securities" of Catlin or a "securities exchange offeror", they would, if the City Code were applicable, be deemed to be a single person for the purpose of Rule 8.3 of the City Code.

Consistent with the provisions of Rule 8.1 of the City Code, Opening Position Disclosures should be made by Catlin and by any "offeror", and all "dealings" in "relevant securities" of Catlin by Catlin, by any "offeror" or by any persons "acting in concert" with any of them, should be disclosed in a Dealing Disclosure by no later than 12.00 noon (London time) on the Business Day following the date of the relevant transaction. 

"Interests in securities" arise, in summary, when a person has long economic exposure, whether conditional or absolute, to changes in the price of "securities".  In particular, a person will be treated as having an "interest" by virtue of the ownership or control of "securities", or by virtue of any option in respect of, or derivative referenced to, "securities".

Terms in quotation marks are defined in the City Code, which can also be found on the Panel's website.  If you are in any doubt as to whether or not you should disclose a "dealing" by reference to the above, you should contact an independent financial adviser authorised by the FCA under FSMA.

 

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