Fairfax Financial Partners With Kennedy Wilson to Acquire Loan Portfolio From Pacific Western Bank, Makes Additional Equity Investment in Kennedy Wilson
2023年6月5日 - 8:55PM
Fairfax Financial Holdings Limited (TSX:FFH and TSX:FFH.U) is
pleased to announce that it has agreed with Kennedy-Wilson
Holdings, Inc. (“Kennedy Wilson”) (NYSE:KW) that, through certain
of its subsidiaries (collectively, “Fairfax”), it will acquire an
interest of approximately 95% in certain of the real estate
construction loans (collectively, the “Loans”) that Kennedy Wilson
has agreed to acquire from Pacific Western Bank (the
“Transaction”), a bank holding company headquartered in California.
The total purchase price for the Loans is
approximately $2.1 billion, of which Fairfax will fund 95%
(approximately $2.0 billion). The aggregate principal balance
currently outstanding under the Loans is approximately $2.3
billion. Fairfax will also assume approximately 95% of all future
funding obligations under the Loans, subject to customary
conditions to disbursement, which future funding obligations
attributable to Fairfax total approximately $1.7 billion. The
aggregate principal balance of the Loans, which are floating rate,
currently carries an average interest rate of approximately 8.6%,
and Fairfax has entered into interest rate swap arrangements to
effectively fix this rate over the life of the Loans. The
weighted-average remaining term to maturity for the Loans based on
gross commitments is approximately 1.7 years, with some Loans
subject to customary extension rights by the borrower up to a
maximum of two additional one-year terms. Taking into account the
discount at which Fairfax acquired the principal balances of the
Loans, Fairfax expects the average annual return on the capital
deployed by Fairfax in connection with the Loans to exceed 10%. All
of the Loans are secured by real property located in the United
States with an average loan-to-value ratio of approximately 51% and
are supported by completion guarantees issued by the project equity
sponsors. More than 70% of the Loans relate to multifamily or
student housing development projects with the balance being a mix
of industrial, hotel and life science office property development
projects.
“We are excited to continue our great
partnership with Kennedy Wilson, led by Bill McMorrow, and to
acquire an interest in a stable and attractive loan portfolio that
further strengthens the foundation of interest and dividend
income-generating assets that will benefit Fairfax over the next
two to three years,” said Prem Watsa, Chairman and CEO of Fairfax
Financial Holdings Limited.
The closing of the Transaction and the sale of
each Loan is subject to the satisfaction of customary closing
conditions (including Pacific Western Bank securing certain
counterparty consents and waivers), and it currently expected to
close in multiple tranches during the second and early part of the
third quarter of 2023. If a required counterparty consent or waiver
in respect of a single Loan is not obtained, Fairfax will not be
obligated to acquire that Loan but Fairfax’s rights and obligations
with respect to the acquisition of each other Loan will be
unaffected.
In addition to the Transaction, Fairfax also
agreed to make a $200 million preferred equity investment in
Kennedy Wilson. Under the terms of the agreement relating to the
investment, Fairfax will acquire perpetual preferred stock that
carries a 6.0% annual dividend rate and is callable by Kennedy
Wilson at any time. Additionally, Fairfax acquired 7-year warrants
for approximately 12.3 million common shares with an initial strike
price of $16.21 per share, based on Kennedy Wilson’s closing price
on June 2, 2023. The investment is subject to customary closing
conditions and is expected to close during the second quarter of
2023.
Fairfax Financial Holdings Limited is a holding
company which, through its subsidiaries, is primarily engaged in
property and casualty insurance and reinsurance and the associated
investment management.
For further information contact: John Varnell,
Vice President, Corporate Development at (416) 367-4941
Certain statements contained herein may
constitute forward-looking statements and are made pursuant to the
“safe harbour” provisions of the United States Private Securities
Litigation Reform Act of 1995 and any applicable Canadian
securities regulations. Such forward-looking statements are subject
to known and unknown risks, uncertainties and other factors which
may cause the actual results, performance or achievements of
Fairfax to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements. Such factors include, but are not
limited to: a reduction in net earnings if our loss reserves are
insufficient; underwriting losses on the risks we insure that are
higher or lower than expected; the occurrence of catastrophic
events with a frequency or severity exceeding our estimates;
unfavourable changes in market variables, including interest rates,
foreign exchange rates, equity prices and credit spreads, which
could negatively affect our investment portfolio; the cycles of the
insurance market and general economic conditions, which can
substantially influence our and our competitors' premium rates and
capacity to write new business; insufficient reserves for asbestos,
environmental and other latent claims; exposure to credit risk in
the event our reinsurers fail to make payments to us under our
reinsurance arrangements; exposure to credit risk in the event our
insureds, insurance producers or reinsurance intermediaries fail to
remit premiums that are owed to us or failure by our insureds to
reimburse us for deductibles that are paid by us on their behalf;
our inability to maintain our long term debt ratings, the inability
of our subsidiaries to maintain financial or claims paying ability
ratings and the impact of a downgrade of such ratings on derivative
transactions that we or our subsidiaries have entered into; risks
associated with implementing our business strategies; the timing of
claims payments being sooner or the receipt of reinsurance
recoverables being later than anticipated by us; risks associated
with any use we may make of derivative instruments; the failure of
any hedging methods we may employ to achieve their desired risk
management objective; a decrease in the level of demand for
insurance or reinsurance products, or increased competition in the
insurance industry; the impact of emerging claim and coverage
issues or the failure of any of the loss limitation methods we
employ; our inability to access cash of our subsidiaries; our
inability to obtain required levels of capital on favourable terms,
if at all; the loss of key employees; our inability to obtain
reinsurance coverage in sufficient amounts, at reasonable prices or
on terms that adequately protect us; the passage of legislation
subjecting our businesses to additional adverse requirements,
supervision or regulation, including additional tax regulation, in
the United States, Canada or other jurisdictions in which we
operate; risks associated with government investigations of, and
litigation and negative publicity related to, insurance industry
practice or any other conduct; risks associated with political and
other developments in foreign jurisdictions in which we operate;
risks associated with legal or regulatory proceedings or
significant litigation; failures or security breaches of our
computer and data processing systems; the influence exercisable by
our significant shareholder; adverse fluctuations in foreign
currency exchange rates; our dependence on independent brokers over
whom we exercise little control; risks associated with IFRS 17;
impairment of the carrying value of our goodwill, indefinite-lived
intangible assets or investments in associates; our failure to
realize deferred income tax assets; technological or other change
which adversely impacts demand, or the premiums payable, for the
insurance coverages we offer; disruptions of our information
technology systems; assessments and shared market mechanisms which
may adversely affect our insurance subsidiaries; and risks
associated with the global pandemic caused by COVID-19 and the
conflict in Ukraine. Additional risks and uncertainties are
described in our most recently issued Annual Report which is
available at www.fairfax.ca and in our Base Shelf Prospectus (under
“Risk Factors”) filed with the securities regulatory authorities in
Canada, which is available on SEDAR at www.sedar.com. Fairfax
disclaims any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by applicable
securities law.
Kennedy Wilson (NYSE:KW)
過去 株価チャート
から 6 2024 まで 7 2024
Kennedy Wilson (NYSE:KW)
過去 株価チャート
から 7 2023 まで 7 2024