Catlin Announces ‘Scheme of Arrangement’ with XL has Become Effective

The Bermuda-based Catlin Group Limited announced that the “scheme of arrangement under section 99 of the Companies Act 1981 (as amended), pursuant to which XL Group plc has acquired the entire issued and to be issued share capital of Catlin, has become effective.”

As a result Catlin said its shares, traded on the London Stock Exchange have been cancelled to coincide with the issuance of “New XL shares, and dealings in the New XL Shares on the New York Stock Exchange and Bermuda Stock Exchange, will occur today, with settlement of the cash consideration expected to take place by Friday, 15 May 2015.”

The announcement explained that under the terms of the Scheme, “holders of Catlin Shares of record as at 6.00 p.m. on Thursday, 30 April 2015 were entitled to receive the default consideration of 388 pence [app. $5.93] in cash and 0.130 New XL Share for each Catlin Share held, subject to any valid elections made and accepted pursuant to the Mix and Match Facility.”

Other technical considerations were also referred to, including elections by Catlin shareholders to receive additional shares and in lieu of the cash payment. “The ability of XL to satisfy all valid elections is dependent on other Catlin shareholders making off-setting elections, so that the total amount of cash and total number of New XL Shares to be paid and issued by XL is not varied,” the announcement continued.

It also noted that when all of the elections by shareholders were made there wasn’t enough to fully satisfy all of the cash elections. They will therefore “be scaled down on a pro rata basis, with the result that 77.0270404 per cent. of Cash Elections will be capable of being satisfied (as between electing shareholders, on a pro rata basis), with the balance of the shares in respect of which such Cash Elections were received but are unable to be satisfied being deemed to be shares in respect of which no election was made.”

In conclusion the announcement detailed the considerations involved in the “Irish Stamp Duty,” which requires tax payments for transfers of “domestic depositary interests (DDis), and concluded that “no stamp duty will arise on the transfer of DDIs where those DDIs represent DTC book entry interests in XL shares which themselves qualify for exemption from Irish stamp duty. Consequently, we do not expect a transfer of DDIs representing DTC book entry interests in XL shares to be subject to Irish stamp duty.”

Source: Catlin Group