Financial Services

FBD major shareholder clears the way for Fairfax loan buyout

Chairman Padraig Walshe called the transaction “an excellent result” for its farmer shareholders

Farmer Business Developments plc, FBD’s founder and one of its biggest shareholders, confirmed that it subscribed for €20 million of the €50 million loan notes used in the insurer’s recent restructuring

Wed Nov 7 2018 - 20:41

Insurer FBD Holdings' original backer subscribed for €20 million worth of loan notes used in clearing a €70 million debt to Canada's Fairfax Financial Holdings.

Farmer Business Developments plc, FBD's founder and one of its biggest shareholders, confirmed that it subscribed for €20 million of the €50 million loan notes used in the insurer's recent restructuring.

This allowed FBD to buy out Fairfax’s loan, which the Canadian group could otherwise have converted to shares.

Farmer Business Developments plc chairman Padraig Walshe called the transaction "an excellent result" for its farmer shareholders whom he noted founded FBD 50 years ago and wanted to see it stay in Irish ownership.

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Mr Walshe added that crucially, the plc had avoided any dilution of its 24.6 per cent stake in FBD.

“Had Fairfax converted, they would have secured 19.1 per cent of FBD Holdings and we would have been reduced to 19.7 per cent,” he explained.

Mr Walshe said the plc looked forward to benefitting from FBD’s future growth.

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