Property and Casualty re/insurance holding company Fairfax Financial has entered into a $900 million agreement to offload a 9.99% interest in Odyssey Group, its US re/insurance subsidiary.
The transaction will be achieved via a sale of securities to affiliate CPPIB Credit Investments and OMERS, a defined benefit pension plan for Ontario’s municipal sector employees. Each entity are set to acquire a 4.995% stake.
After closing, Fairfax will retain flexibility in repurchasing the interests of OMERS and CPPIB Credit Investments in Odyssey Group over time.
Concurrently, Fairfax has announced its intention to commence an issuer bid offering to purchase for cancellation up to $1 billion of subordinate voting shares from shareholders for cash.
This deal will proceed by way of a “modified Dutch auction”, allowing shareholders to within a specified range select the price they are willing to pay.
Prices range from $425 to $500 per share, while the number of sold shares limited to 2,352,941, approximately 8.72% of Fairfax’s total stake.
Shareholders who wish to participate in the offer will be able to do so through auction tenders in which they will specify the number of shares being tendered.
