Announcement of Capacity Offer by Advent Capital (No. 3) Limited (a company incorporated in England and Wales with number 5528808) ('AC3') for all non-aligned capacity on Syndicate 780
Advent Capital (Holdings) PLC ('Advent') today announces that an offer ('the Offer”) has been made by AC3, a wholly owned subsidiary of Advent, to all non-aligned members on Syndicate 780 to acquire all of the capacity not already owned by Advent or any of its subsidiaries (together the 'Advent Group'). The Offer relates to capacity for 2007 and onwards and does not affect prior years.
The Advent Group currently owns 80% of the capacity (representing £122 million out of a total syndicate capacity of £152m for the 2006 year of account) on Syndicate 780 and, pursuant to the terms of the Offer, has offered to acquire the remaining 20% of such capacity. The Offer will remain open for acceptance until 25 August 2006. Advent Underwriting Limited intends to apply to Lloyd’s for permission to give notice of termination of the standard managing agent’s agreement to all of those members of Syndicate 780 who do not accept the Offer, provided that at such date AC3 has acquired, or contracted to acquire under the Offer, 90% (or such other proportion as the Council of Lloyd’s may specify) of the capacity of Syndicate 780 for the 2007 year of account (the 'Minority Buy-out'). The Offer is conditional, inter alia, on Lloyd’s granting consent to the Minority Buy-out.
The Offer consideration comprises 5p in cash for each £1 of capacity held on Syndicate 780 for the 2006 year of account. In addition Members are offered a “Limited Tenancy Arrangement”, under which they have the right to participate on Syndicate 780 for the 2007 year of account only plus a deferred payment of an additional 5p in cash for each £1 of capacity underwritten in the 2007 year of account payable on 30 June 2008 (the 'Limited Tenancy Rights').
AC3 has received undertakings from the two members’ agents which represent 99.7% of the outstanding capacity for the 2006 year of account, to make a general recommendation to their members to accept the Offer in respect of the whole of their capacity, the recommendation being subject to the individual circumstances of each member. If Lloyd’s grants its consent to the Minority Buy-out then the total consideration payable would be £1.5 million on closure of the Offer, with up to a further £1.5 million payable on 30 June 2008, dependant on the take up of the Limited Tenancy Rights.
In the event that the Offer becomes unconditional and assuming that members take up all of their Limited Tenancy Rights, AC3 intends to maintain its current level of underwriting at £122 million of capacity for the 2007 year of account.
This announcement does not constitute a solicitation, invitation, or offer to persons in Singapore or any other jurisdiction where a solicitation, invitation or offer could be contrary to law.
This announcement has been approved by Advent Underwriting Limited which is regulated by the FSA for the purposes of section 21 of the Financial Services and Markets Act 2000. This announcement relates to a capacity offer which is being made in the name of AC3. Advent Underwriting Limited and Advent Capital (Holdings) PLC are interested in this capacity offer.
Any person who is considering participating in this capacity offer should read carefully the offer document relating to such capacity offer (and the syndicate business forecast which will be available, along with copies of the offer document, free of charge, at 10th Floor, 1 Minster Court, Mincing Lane, London EC3R 7AA) and the risk factors set out in the offer document.
This announcement has been prepared in accordance with Lloyd’s requirements. AC3 has confirmed to Lloyd’s that this document complies with the Capacity Offer Rules. This announcement has not been approved by Lloyd’s.
If you are resident in the Republic of South Africa or Thailand and wish to accept the Capacity Offer, you must comply with all applicable South African or Thailand exchange control requirements. If you are in any doubt you should take professional advice from a person properly qualified to advise you.
The contents of this document have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the Capacity Offer. If you are in any doubt about any of the contents of this document, you should obtain independent professional advice.
Date issued: 28 July 2006
Contact information
Agency contact name: Joe Perdoni
Agency contact no: + 44 (0) 207 743 8200
For auction office use only: D2006002
