UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): December 10, 2007
Enstar Group Limited
(Exact name of registrant as specified in its charter)
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| Bermuda
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001-33289
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N/A |
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(State or other Jurisdiction
of Incorporation)
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(Commission
File Number)
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(IRS Employer
Identification No.) |
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P.O. Box HM 2267,
Windsor Place, 3rd Floor, 18 Queen Street
Hamilton HM JX Bermuda |
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(Address of Principal Executive Offices)
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(Zip Code) |
Registrant’s telephone number, including area code: (441) 292-3645
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy
the filing obligation of the registrant under any of the following provisions (see General
Instruction A.2. below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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| Item 1.01. |
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Entry into a Material Definitive Agreement. |
On December 10, 2007, Enstar Group Limited (the “Company”) and its wholly-owned subsidiary,
Enstar Australia Holdings Pty Limited (“Enstar Australia”), entered into a definitive agreement for
the purchase of AMP Limited’s (“AMP”) Australian-based closed reinsurance and general insurance
operations, for a purchase price of AUS$585 (approximately US$518 million). The entities
affiliated with AMP Limited that are parties to the agreement are AMP Insurance Investment Holdings
Pty Limited, AMP Holdings Limited, AMP Group Services Limited, AMP Group Holdings Limited and AMP
Services Limited.
Upon completion of the transaction, Enstar Australia will acquire Gordian RunOff Limited, TGI
Australia Limited and AMPG (1992) Limited, all of which had been placed into run-off between 1999
and 2002, AMP’s manager of these businesses, Cobalt Solutions Australia Limited, as well as certain
other affiliated entities (the acquired companies, collectively “Gordian”).
The purchase price will be reduced by the amount of any distributions paid by Gordian to AMP
prior to closing. Gordian has requested Australian regulatory approval to pay pre-sale
distributions of up to AUS$183.9 million (approximately US$162.8 million). The net purchase price
will increase by an earnings factor calculated from July 1, 2007 through the closing date based on
the ninety day moving average of the three month Australian bank bill swap reference mid-rate plus
30 basis points.
The net purchase price is expected to be financed by approximately 70% from a major Australian
bank, approximately 7.5% from J.C. Flowers II L.P. (the “Flowers Fund”); and approximately 22.5%
from available cash on hand. The Flowers Fund is a private investment fund for which JCF
Associates II L.P. is the general partner and J.C. Flowers & Co. LLC is the investment advisor.
JCF Associates II L.P. and J.C. Flowers & Co. LLC are controlled by J. Christopher Flowers, a
director and one of the Company’s largest shareholders. In addition, John J. Oros, a director and
the Company’s Executive Chairman, is a Managing Director of J.C. Flowers & Co. LLC.
Completion of the transaction is conditioned on, among other things, approval by the
Australian regulatory authorities and satisfaction of various customary closing conditions. The
transaction is expected to close in the first quarter of 2008.
This Current Report on Form 8-K contains certain forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. These statements include statements
regarding the intent, belief or current expectations of the Company and its management team.
Prospective investors are cautioned that any such forward-looking statements are not guarantees of
future performance and involve risks and uncertainties, and that actual results may differ
materially from those projected in the forward-looking statements as a result of various factors.
In particular, the Company may not be able to complete the proposed transaction or the related
financing on the terms summarized above or other acceptable terms, or at all, due to a number of
factors, including but not limited to the failure to obtain governmental and regulatory approvals
or to satisfy other closing conditions. Other important risk factors regarding the Company may be
found under the heading “Risk Factors” in the Company’s Form 10-K for the year ended December 31,
2006, and are incorporated herein by reference. Furthermore, the Company undertakes no obligation
to update any written or oral forward-looking statements or publicly announce any updates or
revisions to any of the forward-looking statements contained herein, to reflect any change in its
expectations with regard thereto or any