Willis, shareholders agreed to restructure with Gras Savoye Astorg
November 20th, 2009
Willis Group Holdings Limited and the shareholders of family origin of Savoy, French insurance broker Gras & Co. announced they had signed a definitive agreement with Astorg Partners, a private equity fund, to reorganize the capital in Gras Savoye a transaction by borrowing.
The transaction should be finalized in the fourth quarter of 2009, subject to customary approvals and completion of financing.
“Gras Savoye has been an associate of Willis since 1997, when Willis had acquired an interest of 33 per cent ownership,” said the bulletin. “Since then, Willis has gradually increased its stake to 48.6 per cent of the vote (46.2 per cent of outstanding shares). The family shareholders and management now own 51.4 per cent of voting shares of Gras Savoye.
“Under the transaction, Astorg Partners acquires 33.3 per cent of the vote (31.8 per cent of outstanding shares) of a new holding company while Willis and the family shareholders will sell part of their holdings in Gras Savoye Astorg Partners and roll over their remaining shares in the new holding company, through a combination of equity, convertible debt and seller financing.
“Willis, the family shareholders of Gras Savoye and Astorg hold equal stakes of 31.8 percent in the new holding company and have equal representation of 33.3 per cent of voting rights to its Board. The remaining 4 , 5 per cent will be owned by a large pool of managers Gras Savoye.
Willis said that the terms of the transaction value of its existing investments in Gras Savoye approximately 343 million dollars. As the operation takes place, Willis said he “will run about $ 135 million in shares and convertible bonds and provide about 48 million to the new holding company at a rate of 6 percent per year . Willis expects to generate approximately $ 160 million in tax-free cash proceeds net of transaction, which will be used to repay existing debt. ”
Furthermore Willis noted that the agreement also gives the company the option to buy 100 per cent stake in the new holding company in 2015, should he choose to do, with a notification in 2014. One option Sales of existing shareholders gave the family the option to sell their shares at Gras Savoye Willis between now and 2011 will be canceled at the close of the transaction. ”
President and CEO Joe Plumeri said Willis “looks forward to building on the strong and valuable relationship we have established with Gras Savoye over the past 12 years, and we remain fully committed to our partnership. This new agreement strengthens the financial flexibility Willis, while at the same time, initiate a new important strategic partner in its investment Gras Savoye.
Patrick Lucas, who will continue as head of Gras Savoye as President and CEO, described the new ownership structure as allowing “everyone to Gras Savoye to connect more closely with the success of our company.”
Christian Couturier, a partner at Astorg Partners, expressed his satisfaction with the transaction, and said that under the leadership of Lucas’ personal investment with a large number of managers and employees Gras Savoye, and the support of Willis and “Astorg history as an active shareholder in the family business, it would” create the conditions for success over the next five years. ”
Willis held a teleconference and webcast today, Thursday, November 19, 2009, at 8:00 PM Eastern Time, with Plumeri.
The materials of the webcast and presentation will be available in the Investor Relations website at Willis: www.willis.com. To connect to the live teleconference, please call (866) 803-2143 (domestic) or +1 (210) 795-1098 (international) with a code of “Willis.” Media and individuals will be in listening mode only. Participants are asked to call in a few minutes before the conference to register for the event. A replay of the call will be available until December 19, 2009 at 10:59 AM Eastern Time by calling (800) 754-7904 (domestic) or +1 (203) 369-3332 (international), no code of access, or accessing the website.
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