Exercise of Over-Allotment
Lancashire Holdings Limited
14 December 2005
Lancashire Holdings Limited
For publication in the United Kingdom and Bermuda only. Not for release,
publication or distribution in the United States of America, Australia, Canada,
South Africa, the Republic of Ireland or Japan
14 December, 2005
ANNOUNCEMENT OF EXERCISE OF OVER-ALLOTMENT OPTION
Further to the announcement on 13 December, 2005 that Lancashire Holdings
Limited ('Lancashire' or the 'Company') has raised (subject, inter alia, to
admission of the Company's common shares to trading on AIM ('Admission'))
approximately US$910 million (before expenses) through a placing (the 'Placing')
of 182 million common shares at a price of 284 pence (US$5.00) per share,
Lancashire announces that it has received notice from Merrill Lynch, acting on
behalf of the managers to the Placing (Merrill Lynch, JPMorgan Cazenove,
Fox-Pitt, Kelton and Teather & Greenwood), that it has exercised in full the
over-allotment option in respect of a total of 10,500,000 new common shares of
the Company.
The price per common share issued pursuant to the over-allotment option will be
equal to the placing price of 284 pence per common share. The gross proceeds
receivable by Lancashire in respect of the common shares to be issued pursuant
to the over-allotment option (subject to Admission) will amount to approximately
US$53 million. The total gross proceeds to be received by Lancashire from the
Placing, including the common shares to be issued pursuant to the over-allotment
option, will amount to approximately US$963 million (subject to Admission). In
addition, the Company has raised approximately US$125 million (before expenses)
through the issue of trust preferred securities and subordinated notes (subject
to Admission).
Conditional dealings in the common shares commenced on 13 December, 2005, with
Admission and commencement of unconditional dealings expected on 16 December,
2005. It should be noted that if Admission does not occur all conditional
dealings will be of no effect and any share dealings will be at the sole risk of
the parties concerned. In addition, it should be noted that although A.M. Best
has indicated that (subject to receipt of necessary funds) Lancashire Insurance
Company Limited will be granted an 'A-' financial strength rating, if A.M. Best
is unable or unwilling for any reason to grant the initial 'A-' financial
strength rating to Lancashire Insurance Company Limited after the Group has
demonstrated to A.M. Best the receipt of necessary funds, it is likely that the
common shares would be suspended and the Company may seek to return the net
proceeds of the Placing to shareholders.
Contacts:
Merrill Lynch
Rupert Hume-Kendall +44 (0)207 628 1000
Simon Fraser
Matthew Thomson
Benfield Advisory
Tristan McDonald +44 (0)207 578 7000
Ross Milburn
Kinmont
Gavin Kelly +44 (0)207 493 8488
John O'Malley
Financial Dynamics
Robert Bailhache +44 (0)207 269 7200
Dominick Peasley
Merrill Lynch, JPMorgan Cazenove, Fox-Pitt, Kelton, Teather & Greenwood,
Benfield Advisory and Kinmont, each of which is authorised and regulated in the
UK by the Financial Services Authority, are each acting for the Company and
no-one else in connection with the Placing and Admission and will not be
responsible to anyone other than the Company for providing the protections
afforded to their respective clients or for providing advice in relation to the
Placing and Admission, this announcement or any other matter. Merrill Lynch's
responsibilities as the nominated adviser to the Company are owed solely to the
London Stock Exchange and are not owed to the Company or to any Director or to
any other person, whether in respect of any decision to acquire common shares,
in relation to any part of this announcement or otherwise.
In connection with the Placing, no common shares of the Company have been
marketed to or are available for purchase by the public in the United Kingdom,
Bermuda or elsewhere.
The release, publication or distribution of this announcement in certain
jurisdictions may be restricted by law and therefore persons in such
jurisdictions into which this announcement is released, published or distributed
should inform themselves about and observe such restrictions.
No offer, invitation or inducement to acquire common shares or other securities
in the Company or any other company is being made by this announcement.
Certain statements contained in this announcement may constitute forward-looking
statements. Any such forward-looking statements involve risks, uncertainties and
other factors that may cause the actual results, performance or achievements of
Lancashire, or industry results, to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. These forward-looking statements speak only as of
the date of this announcement and there can be no assurance that the results and
events contemplated by such forward-looking statements will, in fact, occur. The
Company and the Directors expressly disclaim any obligation or undertaking to
release publicly any updates or revisions to any forward-looking statement
contained herein, save as required to comply with any legal or regulatory
obligations (including the AIM Rules).
This announcement is not an invitation nor is it intended to be an inducement to
engage in investment activity for the purpose of Section 21 of the Financial
Services and Markets Act 2000 ('FSMA'). The Company's common shares are in any
event being placed only with (i) persons who have professional experience in
matters relating to investments and who are investment professionals within the
meaning of Article 19(5) of the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005 of the United Kingdom (the 'Financial Promotion
Order') or (ii) persons who fall within Article 49(2)(a) to (d) ('high net worth
companies, unincorporated associations etc.') of the Financial Promotion Order
(all such persons together being referred to as 'relevant persons'). Any
investment or investment activity to which this announcement relates is
available only to relevant persons in the United Kingdom and will be engaged in
only with relevant persons. Anyone other than a relevant person must not rely on
this announcement.
The contents of this announcement, which have been prepared by and are the sole
responsibility of Lancashire Holdings Limited, have been approved by Merrill
Lynch International of Merrill Lynch Financial Centre, 2 King Edward Street,
London EC1A 1HQ, solely for the purposes of section 21(2)(b) of FSMA.
THE INFORMATION CONTAINED HEREIN IS NOT FOR PUBLICATION OR DISTRIBUTION INTO THE
UNITED STATES, AUSTRALIA, CANADA, SOUTH AFRICA, THE REPUBLIC OF IRELAND OR
JAPAN. NEITHER THIS ANNOUNCEMENT NOR ANY COPY OF IT MAY BE TAKEN OR DISTRIBUTED
OR PUBLISHED, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES, AUSTRALIA, CANADA,
SOUTH AFRICA, THE REPUBLIC OF IRELAND OR JAPAN OR DISTRIBUTED TO U.S. PERSONS.
THE MATERIAL SET FORTH HEREIN IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT
INTENDED, AND SHOULD NOT BE CONSTRUED, AS AN OFFER OF SECURITIES FOR SALE INTO
THE UNITED STATES OR ANY OTHER JURISDICTION. SECURITIES MAY NOT BE OFFERED OR
SOLD IN THE UNITED STATES ABSENT REGISTRATION UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED OR AN APPLICABLE EXEMPTION FROM REGISTRATION. THE SECURITIES OF
THE COMPANY DESCRIBED HEREIN HAVE NOT BEEN AND WILL NOT BE SO REGISTERED. THERE
WILL BE NO PUBLIC OFFER OF SECURITIES IN THE UNITED STATES, AUSTRALIA, CANADA,
OR JAPAN OR ANY OTHER JURISDICTION.
Stabilisation / FSA
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