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8-K - CURRENT REPORT - Flagstone Reinsurance Holdings, S.A. | form8-k.htm |
Exhibit
99.1
FLAGSTONE
RE ANNOUNCES PROPOSED REDOMESTICATION
FROM
BERMUDA TO LUXEMBOURG
HAMILTON, Bermuda, March 22, 2009 -
Flagstone Reinsurance Holdings Limited (NYSE: FSR) today announced that
its Board of Directors is recommending to the shareholders a plan to change the
Company’s place of incorporation from Bermuda to
Luxembourg. Flagstone’s shareholders will be asked to vote in favor
of the proposal subject to the U.S. Securities and Exchange Commission (“SEC”)
declaring effective the proxy statement/prospectus that Flagstone expects to
file in connection with the redomestication.
If
approved by shareholders, and subject to certain regulatory approvals and the
satisfaction of other conditions, Flagstone expects the redomestication to take
place over several months following shareholder approval.
“After
careful consideration of this decision, our Board of Directors and management
team believe that changing Flagstone’s place of incorporation to Luxembourg is
in the best interests of the Company and its shareholders,” said Flagstone’s
Chief Executive Officer, David Brown. “Luxembourg is a major
financial center known for its stability as well as its financial
sophistication, and we believe this move will increase our strategic and capital
flexibility while maintaining our operating model and our long-term
strategy. This change will have no impact on our operations and in
particular Flagstone will retain its substantial offices and operations in
Bermuda, where we have conducted business since our founding.”
“We
are pleased to have the opportunity to increase our presence in Luxembourg,
where our investment management operations have been located for some time”,
Flagstone’s Chairman Mark Byrne continued. “Luxembourg has a network
of excellent relations with major developed and developing countries around the
world. And, in addition to our listing on the New York Stock Exchange, this
change in incorporation has the potential to make a listing of our common shares
on a European exchange more attractive. We are proud of our unique
global business and this change, which results in our holding and principal
operating companies being in Europe, settles our identity as a European company
with a substantial and important branch in the thriving Bermuda
market.”
Flagstone
has operated in Luxembourg for most of its corporate history and is familiar
with its regulatory and legal environment. Flagstone’s existing office in
Luxembourg will also become its corporate holding company office.
The
Company’s reinsurance and insurance operations worldwide will continue to
operate without material changes, and its principal operating center will remain
in Switzerland. Flagstone will continue to maintain underwriting and executive
offices in Bermuda and recognizes the important role that Bermuda plays in the
global reinsurance market. Flagstone does not expect the
redomestication to have any material change on its operations or financial
results.
Flagstone’s
common shares will continue to trade on the New York Stock Exchange (“NYSE”)
under the ticker symbol “FSR” and on the Bermuda Stock
Exchange. Flagstone will continue to be registered with the SEC and
remain subject to SEC reporting requirements, the mandates of the Sarbanes-Oxley
Act of 2002, and
the corporate governance rules of the NYSE. Finally, the Company will
continue to report its consolidated financial results in U.S. dollars using U.S.
generally accepted accounting principles.
Flagstone
expects to file with the SEC a proxy statement/prospectus on Form S-4 in
connection with the redomestication. This press release is not a substitute for
the proxy statement/prospectus. Investors and security holders are urged to read
the proxy statement/prospectus when it is available and any other relevant
documents filed or to be filed by Flagstone because they contain or will contain
important information about the proposed redomestication. The proxy
statement/prospectus and other documents filed or to be filed by Flagstone with
the SEC are or will be available free of charge at the SEC’s website
(www.sec.gov).
Flagstone
and its directors, executive officers and other employees may be deemed to be
participants in the solicitation of proxies in connection with the proposed
redomestication. Information about Flagstone’s directors and executive officers
will be available in the proxy statement/prospectus to be filed in connection
with the redomestication.
About
Flagstone Reinsurance Holdings Limited
Flagstone
Reinsurance Holdings Limited, through its operating subsidiaries, is a global
reinsurance and insurance company that employs a focused and technical approach
to the Property Catastrophe, Property, and Specialty reinsurance and insurance
businesses. Flagstone Reassurance Suisse has received "A-" financial strength
ratings from both A.M. Best and Fitch Ratings, and "A3" ratings from Moody’s
Investors Service. Island Heritage and Flagstone Reinsurance Africa have
received "A-" financial strength ratings from A.M. Best.
Cautionary
Statement Regarding Forward-Looking Statements
This
press release may contain, and the Company may from time to time make, written
or oral “forward-looking statements” within the meaning of the U.S. federal
securities laws, which are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. All forward-looking statements
rely on a number of assumptions concerning future events and are subject to a
number of uncertainties and other factors, many of which are outside the
Company’s control, which could cause actual results to differ materially from
such statements. In particular, statements using words such as “may”,
“should”, “estimate”, “expect”, “anticipate”, “intend”, “believe”, “predict”,
“potential”, or words of similar import generally involve forward-looking
statements. For example, the Company’s forward-looking statements
about the redomestication and its anticipated effects, operations, stock trading
matters, and tax and financial matters could be affected by risks including that
the redomestication may not close, shareholders or regulators may not provide
required approvals, the Company may encounter difficulties moving jurisdictions,
tax and financial expectations might not materialize or might change, and
Luxembourg corporate governance and regulatory schemes could prove different or
more challenging than currently expected.
In
addition, other important events and uncertainties that the Company faces
include, but are not necessarily limited to: market conditions affecting the
Company’s common share price; the impact of the current unprecedented volatility
in the financial markets, including the duration of the crisis and the
effectiveness of governmental solutions; the weakening economy, including the
impact on our customers’ businesses; fluctuations in interest rates; the effects
of corporate bankruptcies on capital markets; the possibility of severe or
unanticipated losses from natural or man-made catastrophes; the effectiveness of
our loss limitation methods; our dependence on principal employees; the cyclical
nature of the reinsurance business; the levels of new and renewal business
achieved; opportunities to increase writings in our core property and specialty
reinsurance and insurance lines of business and in specific areas
of the casualty reinsurance market; the sensitivity
of our business to financial strength ratings established by independent rating
agencies; the estimates reported by cedents and brokers on pro-rata contracts
and certain excess of loss contracts where the deposit premium is not specified
in the contract; the inherent uncertainties of establishing reserves for loss
and loss adjustment expenses, our reliance on industry loss estimates and those
generated by modeling techniques; unanticipated adjustments to premium
estimates; changes in the availability, cost or quality of reinsurance or
retrocessional coverage; changes in general economic conditions; changes in
governmental regulation or tax laws in the jurisdictions where we conduct
business; the amount and timing of reinsurance recoverables and reimbursements
we actually receive from our reinsurers; the overall level of competition, and
the related demand and supply dynamics in our markets relating to growing
capital levels in the reinsurance industry; declining demand due to increased
retentions by cedents and other factors; the impact of terrorist activities on
the economy; and rating agency policies and practices.
These
and other events that could cause actual results to differ are discussed in more
detail from time to time in our filings with the Securities and Exchange
Commission. The Company undertakes no obligation to publicly update
or revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by U.S. federal
securities laws. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date on which they are
made.
FSR
Contacts:
Investor
Relations:
Brent
Slade
+1-441-278-4303
Investors:
Okapi
Partners LLC
Bruce
Goldfarb or Pat McHugh
+1-212-297-0720