Jan 2008 Financial News

Clico challenges Barbados Farms, Sagicor deal

Jan 09, 2008

CLSS Holdings Ltd, a Barbadian-based subsidiary of the Clico Group, has legally challenged the validity of Sagicor Financial Corporation’s “lock-up” agreements with major Barbados Farms Ltd (BFL) shareholders.

Last Friday, Sagicor announced it controlled 7.83 million BFL shares or 38.04 per cent of the company, now the target of a takeover battle between the two companies.

Sagicor’s latest strategy has diminished CLSS Holdings’ changes of acquiring BFL.

CLSS president Terrance Thornhill has criticised Sagicor’s “lock-up agreements” with BFL’s major shareholders.

In a statement, Thornhill has called on the Barbados Securities Commission (BSC) to “investigate whether or not the lock-up agreements with Sagicor were entered after December 7, 2007,” and if it was consistent with the BSC’s “principle and application of the Barbados Takeover Code.”

Thornhill said BFL shareholders had the right to withdraw from the lock-up agreements “when a competing bid is made by a third party which is more than 50 cents above the Sagicor offer.”

Thornhill asked why had BFL directors decided against recommending the CLSS $5.55 all-cash offer even though it was “in the value range that PwC [PricewaterhouseCoopers] considers to be fair from a financial point of view.”

CLSS has stated that compared to Sagicor’s mix of Bds$5 cash and equity, its offer was superior. The Clico subsidiary has urged BFL shareholders to reject Sagicor’s offer.

Sagicor, in the meantime, has made a final appeal to BFL shareholders to accept its cash and equity offer, which it has described as “excellent value.”

It’s offering cash of Bds$5 per share for 35 per cent of BFL shareholders shareholding. The other 65 per cent will be exchanged for Sagicor shares, which the company has valued at Bds$5 each.

CLSS Holdings has offered Bds$5.55 in cash. Its offer closes tomorrow while Sagicor’s offer closes today.

Clico is prepared to pay out Bds$114.33 million for the BFL stock.


Source:
The Trinidad Guardian
January 9th, 2008

http://www.guardian.co.tt/business1.html