Aug 2010 Financial News

GHL’s main players agree to consult IFC

Aug 24, 2010

The key shareholders of Guardian Holdings (GHL), have agreed to consult with the IFC on important corporate actions in return for the IFC investing of $473 million in the Westmoorings-based insurance holding company.

This was revealed in a shareholders’ circular issued on Friday in advance of the meeting of GHL shareholders on September 2 to approve the transaction. If the shareholders agree at the meeting, GHL will issue 29,695,313 new shares in the company to the International Finance Corporation and the IFC African, Latin American and Caribbean Fund at a price of about $16 per share. Of the $473 million from the share sale, $315 million will represent a conversion of the existing $315 million of IFC debt to equity and the balance of $158 million in new monies will be retained for future expansion. The net result of the transaction is that GHL’s shareholder equity increases by $473 million and its debt obligations decrease by $315 million.

The key shareholders are defined in the circular as Arthur Lok Jack and the members of the family of Naz Ahamad, the late GHL chairman. Among them, the key shareholders own 32 per cent of GHL’s stock, according to the circular.

According to the document, the key shareholders agree not to vote in favour of the following corporate actions without first consult the IFC parties:
• any listing of shares, or any private or public offering of shares or any de-listing of shares of the company;
• any reduction of the capital or share repurchase, other than the repurchase of shares under certain stock option arrangements;
• any change of the primary business of the company or to the primary business of any of its key subsidiaries; and
• any disposal or arranging for the disposal of more than 25 per cent of the assets or business of the company.

In addition, there are some corporate actions that the key shareholders have agreed not to vote in favour of without the approval of the IFC parties. The key shareholders also agreed that if they wished to transfer more than 50 per cent of their shareholding in GHL to an unrelated third party, that the IFC “shall have the right to include in such transfer a proportional number of the shares it holds in the company on the same terms.


Source:
Trinidad Guardian
Tuesday August 24, 2010

http://guardian.co.tt/business/business/2010/08/24/ghl-s-main-players-agree-consult-ifc