Tower Group International, Ltd. and ACP Re, Ltd. Announce Amendment to Merger Agreement
08 Mai 2014 - 3:33PM
Business Wire
Tower Group International, Ltd. (NASDAQ:TWGP) (“Tower”) and ACP
Re, Ltd. (“ACP Re”) announced today that they have entered into an
amendment to the merger agreement entered into by them on January
3, 2014. The amendment, among other things, (1) reduces the per
share consideration to be received by holders of Tower’s common
shares in the merger from $3.00 per share to $2.50 per share, (2)
reduces the termination fee that Tower would, under certain
circumstances, be required to pay to ACP Re in the event of a
termination of the merger agreement, (3) extends to November 15,
2014 both the date by which Tower must hold its shareholders
meeting to vote on the merger and the deadline for completing the
merger before either party can terminate the merger agreement, (4)
excludes from the material adverse effect closing condition any
continued adverse results of Tower’s operations or deterioration of
its financial condition resulting from (a) losses and loss
adjustment expenses incurred under new, renewal or in-force
insurance and reinsurance related policies, insurance and
reinsurance related contracts, and insurance and reinsurance
related binders, (b) operating expenses, including acquisition
expenses, associated with maintaining Tower’s agency relationships,
employees and facilities to operate its business in the ordinary
course or (c) the insufficiency of Tower’s loss reserves (including
IBNR reserves), (5) also excludes from the material adverse effect
closing condition any effect resulting from facts or circumstances
disclosed in any of Tower’s previous SEC filings, (6) eliminates
the condition that holders of shares representing more than 15% of
Tower’s share capital shall not have exercised dissenter’s rights,
(7) provides that the closing condition requiring that each of
Tower’s U.S. insurance subsidiaries shall have risk based capital
that is equal to or exceeds its relevant company action level risk
based capital will be deemed to have been satisfied if Tower and
its subsidiaries have, on a consolidated basis, sufficient capital
that could be reallocated among Tower’s insurance subsidiaries so
that such condition could be satisfied and (8) provides that all of
Tower’s representations and warranties in the Merger Agreement will
be qualified by disclosures made in Tower’s previous SEC
filings.
About ACP Re
ACP Re is a Bermuda based reinsurance company. The controlling
shareholder of ACP Re is a trust established by the founder of
AmTrust Financial Services, Inc., National General Holdings
Corporation and Maiden Holdings, Ltd.
About Tower
Tower Group International, Ltd. is a Bermuda-based global
diversified insurance and reinsurance holding company and is listed
on the NASDAQ Global Select Market under the symbol TWGP. Through
our insurance and reinsurance subsidiaries in the U.S. and Bermuda,
collectively referred to as Tower Group Companies, we deliver a
broad range of commercial, personal and specialty insurance
products and services in the U.S. and specialty reinsurance
products globally through our distribution and underwriting
partners.
For more information, visit Tower's website at
http://www.twrgrpintl.com.
Additional Information and Where to Find It
This communication is not a solicitation of a proxy from any
shareholder of Tower. In connection with the merger agreement,
Tower filed a preliminary proxy statement with the Securities and
Exchange Commission (“SEC”) on February 13, 2014 and intends to
file a definitive proxy statement with the SEC and to mail such
definitive proxy statement and a form of proxy to Tower’s
shareholders when they are completed. Investors and shareholders
are urged to read the preliminary proxy statement, the definitive
proxy statement and other relevant materials filed with the SEC
when they become available because they contain or will contain
important information about Tower, ACP Re and the proposed
transaction. The preliminary proxy statement, the definitive proxy
statement and other relevant materials (when they become
available), and any other documents filed by Tower or ACP Re with
the SEC, may be obtained free of charge at the SEC’s website at
www.sec.gov. In addition, investors and shareholders may obtain
free copies of the documents filed by Tower with the SEC by
directing a written request to “Investor Relations,” Tower Group
International, Ltd., Bermuda Commercial Bank Building, 2nd Floor,
19 Par-la-Ville Road, Hamilton, HM 11, Bermuda, or by email to
William E. Hitselberger, Executive Vice President and Chief
Financial Officer at bhitselberger@twrgrp.com.
Participants in the Solicitation
The directors, executive officers and other members of
management and employees of Tower may be deemed participants in the
solicitation of proxies from its shareholders in favor of the
proposed transaction. Information concerning persons who may be
considered participants in the solicitation of Tower’s shareholders
under the rules of the SEC is set forth in public filings filed by
Tower with the SEC and will be set forth in the definitive proxy
statement when it is filed with the SEC. Information concerning
Tower’s participants in the solicitation is contained in Tower’s
Proxy Statement on Schedule 14A, filed with the SEC on
March 25, 2013.
Cautionary Statement Regarding Forward–Looking Statements
The Private Securities Litigation Reform Act of 1995 provides a
“safe harbor” for forward-looking statements. This press release
and any other written or oral statements made by or on behalf of
Tower may include forward-looking statements that reflect Tower’s
current views with respect to future events and financial
performance. All statements other than statements of historical
fact included in this press release are forward-looking statements.
Forward-looking statements can generally be identified by the use
of forward-looking terminology such as “may,” “will,” “plan,”
“expect,” “project,” “intend,” “estimate,” “anticipate,” “believe”
and “continue” or their negative or variations or similar
terminology. All forward-looking statements address matters that
involve risks and uncertainties. Accordingly, there are or will be
important factors that could cause the actual results of Tower to
differ materially from those indicated in these statements. Please
refer to Tower’s filings with the SEC, including among others
Tower’s Annual Report on Form 10-K for the year ended
December 31, 2013, for a description of the important factors
that could cause the actual results of Tower to differ materially
from those indicated in these statements. Forward-looking
statements speak only as of the date on which they are made, and
Tower undertakes no obligation to update publicly or revise any
forward-looking statement, whether as a result of new information,
future developments or otherwise.
Risks that could adversely affect the proposed merger include,
but are not limited to, the following:
- governmental approvals of the merger
may not be obtained or adverse regulatory conditions may be imposed
in connection with governmental approvals of the merger;
- the Board of Directors of Tower may
withdraw its recommendation and support a competing acquisition
proposal; and
- Tower’s shareholders may fail to
approve the merger.
The following important factors are among those that could
affect the actual outcome of other future events:
- changes in our financial strength or
credit ratings could impact our ability to write new business, the
cost of, and our ability to obtain, capital or our ability to
attract and retain brokers, agents and customers;
- further decreases in the capital and
surplus of our insurance subsidiaries and their ability to meet
minimum capital and surplus requirements;
- changes in our ability to access our
credit facilities or raise additional capital;
- the implementation and effectiveness of
our capital improvement strategy;
- Tower’s ability to continue operating
as a going concern;
- changes in our ability to meet ongoing
cash requirements and pay dividends;
- greater frequency or severity of claims
and loss activity, including as a result of natural or man-made
catastrophic events, than our underwriting, reserving or investment
practices anticipate based on historical experience or industry
data;
- changes in the availability, cost or
quality of reinsurance and failure of our reinsurers to pay claims
timely or at all;
- changes in the availability, cost or
quality of reinsurance or retrocessional coverage;
- decreased demand for Tower’s insurance
or reinsurance products;
- increased competition on the basis of
pricing, capacity, coverage terms or other factors;
- ineffectiveness or obsolescence of
Tower’s business strategy due to changes in current or future
market conditions;
- currently pending or future litigation
or governmental proceedings;
- developments that may delay or limit
Tower’s ability to enter new markets as quickly as it
anticipates;
- loss of the services of any of Tower’s
executive officers or other key personnel;
- changes in acceptance of Tower’s
products and services, including new products and services;
- developments in the world’s financial
and capital markets that could adversely affect the performance of
Tower’s investments;
- the effects of acts of terrorism or
war;
- changes in general economic conditions,
including inflation, interest rates and other factors which could
impact Tower’s performance and the performance of Tower’s
investment portfolio;
- changes in accounting policies or
practices;
- changes in legal theories of liability
under Tower’s insurance policies;
- changes in rating agency policies or
practices;
- declining demand for reinsurance due to
increased retentions by cedents and other factors;
- a lack of opportunities to increase
writings in Tower’s reinsurance lines of business and in specific
areas of the reinsurance market;
- changes in the percentage of premiums
written that Tower cedes to reinsurers;
- changes in regulations or laws
applicable to Tower, its subsidiaries, brokers or customers,
including regulatory limitations and restrictions on the
declaration and payment of dividends and capital adequacy
standards;
- the Bermudian regulatory system, and
potential changes thereto;
- risks and uncertainties associated with
technology, data security or outsourced services that could
negatively impact Tower’s ability to conduct its business or
adversely impact its reputation;
- the effects of mergers, acquisitions or
divestitures;
- disruptions in Tower’s business arising
from the integration of acquired businesses into Tower and the
anticipation of potential or pending acquisitions or mergers;
and
- any changes concerning the conditions,
terms, termination, or closing of the merger with ACP Re.
Additional risk factors that may cause outcomes that differ from
our expectations or projections are described in various documents
filed by Tower with the Securities and Exchange Commission, such as
current reports on Form 8–K, and regular reports on Forms 10–K and
10–Q, particularly in “Item 1A, Risk Factors.”
Investors:Tower Group International, Ltd.William E.
Hitselberger,Executive Vice President and Chief Financial
Officer212-655-2110bhitselberger@twrgrp.com
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